S. 4368 — Agua Caliente Band of Cahuilla Indians Water Rights Settlement Act

This section designates the Act as the “Agua Caliente Band of Cahuilla Indians Water Rights Settlement Act” and provides the table of contents.

This section sets forth the purposes of the Act, which are (1) to settle all claims to water rights in California for the Tribe and the United States (acting as trustee for the Tribe and allottees); (2) to settle claims regarding the Tribe's water-related fees, the RAC, and the Tribal Possessory Interest Tax; (3) to ratify the agreement among the Tribe, CVWD, and DWA to the extent consistent with the Act; (4) to direct the Secretary to execute that agreement and carry it out; (5) to authorize funds for implementation; (6) to authorize federal land transfers to the Tribe; and (7) to authorize federal land sales to CVWD.

This section defines terms used in the Act, including "Adjacent Lands" (lands owned, leased, used, occupied, controlled, or managed by the Coachella Valley Water District (CVWD) immediately adjacent to the Facility); "AFY" (acre-feet per calendar year); "Agreement" (the Agua Caliente Band of Cahuilla Indians Water Rights Settlement Agreement dated May 19, 2025, and any amendments consistent with the Act); "Agua Caliente" or "Tribe" (the Agua Caliente Band of Cahuilla Indians); "Agua Caliente Litigation" (specified federal court cases); "Agua Caliente Water Authority (ACWA)"; "Coachella Valley Water District (CVWD)"; "Desert Water Agency (DWA)"; and "Facility Land" (approximately 842.4 acres in specified locations in Riverside County, California, subject to final survey).

This section ratifies the Agreement, except as modified by this Act and to the extent it does not conflict with the Act, and authorizes the Secretary to execute the Agreement and approve consistent post-execution modifications not requiring congressional approval under 25 U.S.C. 177 or other applicable law. The section further requires the Secretary and Tribe, in implementing the Agreement and this Act, to comply with the Endangered Species Act of 1973, National Environmental Policy Act of 1969 (NEPA), and other applicable federal environmental laws; directs the Tribe to prepare necessary environmental documents subject to the Secretary's independent evaluation and responsibility for their accuracy, scope, and contents; deems the Secretary's execution of the Agreement not a major federal action under NEPA; and allocates compliance costs from the Agua Caliente Settlement Trust Fund, except for federal approval, review, or inherently federal functions borne by the Secretary.

This section confirms the Agua Caliente Band of Cahuilla Indians' (Tribe) water right to up to 20,000 acre-feet per year (AFY) of groundwater in the Indio Subbasin, with a priority date no later than the 1876 and 1877 Executive Orders establishing the reservation and superior to rights claimed by water districts. The water right, held in trust by the United States for the Tribe and allottees, is not subject to state law (except in a federal-law-permitted comprehensive adjudication), forfeiture, abandonment, or loss through non-use or other operation of law. The section authorizes the Tribe to use the water right on the reservation for any lawful purpose (including reuse); off-reservation with Secretarial approval for up to 99 years (including renewals); and to impose production fees, water fees, delivery charges, and deliveries exempt from replenishment assessment charges (RAC), preempting inconsistent state or local laws. It applies section 7 of the Act of February 8, 1887 (25 U.S.C. 381), to allottee interests; declares Congressional intent to provide allottees equivalent or superior benefits relative to pre-enactment status (accounting for litigation risks, funding, water availability, and protections); and prohibits permanent alienation while satisfying federal approval requirements for related land transactions. (Thus, the provision ratifies a settlement resolving tribal-state water disputes in the basin.)

This section establishes the Agua Caliente Settlement Trust Fund, managed, invested, and distributed by the Secretary of the Interior consistent with specified laws (i.e., 25 U.S.C. 162a, American Indian Trust Fund Management Reform Act of 1994), consisting of amounts deposited under section 7(a) plus investment earnings and remaining available until expended, withdrawn, or reverted to the Treasury. The section requires the Secretary to create four accounts within the fund—(1) Agua Caliente Development Projects Account, (2) Agua Caliente Groundwater Augmentation Account, (3) Agua Caliente Water Management Account, and (4) Agua Caliente Operation, Maintenance, and Replacement Costs Account—and makes amounts available to the Agua Caliente Band of Cahuilla Indians (Tribe) generally on the enforceability date, except that $50 million deposited into the development projects account is available immediately for water-related projects improving supply, reliability, infrastructure, or quality on the Agua Caliente Indian Reservation. The section authorizes Tribe withdrawals via (1) an approved tribal management plan under the American Indian Trust Fund Management Reform Act of 1994 or (2) an approved expenditure plan, both subject to Secretary enforcement and limited judicial review under the Administrative Procedure Act, with all withdrawals required to align with this Act and the settlement agreement.

This section provides mandatory appropriations totaling $500 million for deposit into four accounts associated with the Agua Caliente Settlement Trust Fund, to remain available until expended, withdrawn, or reverted to the general fund of the Treasury: (1) $300 million for the Agua Caliente development projects account; (2) $100 million for the Agua Caliente Groundwater augmentation account; (3) $50 million for the Agua Caliente Water management account; and (4) $50 million for the Agua Caliente Operation, maintenance and replacement costs account. The section further authorizes adjustments to these amounts—increased or decreased as appropriate—for ordinary cost fluctuations (as indicated by the Bureau of Reclamation Construction Cost Index-Composite Trend), construction cost changes due to unforeseen market volatility (as determined by the Secretary), with the indexing period for each funding increment beginning on May 19, 2025, and ending on the deposit date; this adjustment process repeats for each subsequent appropriation until the authorized amounts, as adjusted, are fully appropriated.

This section establishes the enforceability date of the Act as the date on which the Secretary publishes in the Federal Register a statement certifying that (1) the Agreement has been amended to conform with the Act; (2) the amended Agreement has been executed by all parties, including the United States; (3) all funds required for deposit in accounts under section 7(a) have been appropriated by Congress or provided by the Secretary from other sources; (4) the Decree Court has approved the Agreement and entered the Final Judgment and Decree; and (5) the waivers and releases under section 9 have been executed by the Tribe and the Secretary. The section further provides that the Act expires if the Secretary fails to publish the statement by December 31, 2035, or a later date agreed to by the Tribe, the Secretary, CVWD, and DWA, in which case (1) the waivers and releases under section 9(a), (b), and (c) do not become effective; (2) the authorization, ratification, confirmation, and execution of the Agreement under section 4 cease to be effective; (3) any actions by the Secretary or contracts entered into under the Act are void; (4) unexpended federal funds (plus interest), water rights or contracts, and property acquired or constructed with such funds are returned to the federal government (unless the Tribe and United States agree otherwise and Congress approves); and (5) the United States may offset expended federal funds (plus interest) against any tribal water rights claims in the state or any future tribal water rights settlement.

This section requires the Tribe (on behalf of itself and its members) and the United States, acting as trustee for the Tribe, to execute waivers and releases of all claims—subject to reservations in subsection (e)—against Coachella Valley Water District (CVWD) and Desert Water Agency (DWA) for (1) water rights and pore space rights asserted or assertable before the enforceability date (except as recognized in the agreement and Act); (2) specified damages to water rights, groundwater overdraft, or water quality degradation; (3) CVWD's or DWA's charges or water service provision on the reservation; and (4) negotiation of the agreement or Act. It further requires the United States, acting as trustee for allottees, to waive water rights claims within the reservation (except as recognized) and requires the Tribe to waive claims against the United States for water rights management failures, foregone benefits, litigation costs, and related damages arising before the enforceability date or consistent with the agreement. (Thus, these waivers settle claims from the Agua Caliente Litigation and related disputes over Tribal Water Rights in the Indio Subbasin.)

This section establishes that benefits provided to the Tribe under the Act fully satisfy all tribal claims against the United States waived under section 9(c). The section further establishes that benefits realized by allottees fully satisfy (1) all allottee claims waived under section 9(b), and (2) any similar claims allottees have or could have asserted against the United States.

This section preempts the Riverside County ad valorem property tax on possessory interests (i.e., certain leaseholds and other property interests on tribal lands) for any taxable period when the Agua Caliente Band of Cahuilla Indians (Tribe) imposes an equivalent tribal tax, effective January 1 following the enforceability date. The tribal tax must use rates and assessed values no lower than the preempted county tax; mirror California exemptions for governments and nonprofits; and distribute proceeds on a priority basis to other public agencies (e.g., school districts) in amounts equivalent to their prior entitlements from the county tax, per the tax apportionment schedule (subject to a cap preventing excess distributions). Tribal tax proceeds, after required distributions, must be used solely for specified tribal purposes—including Agua Caliente Water Authority operations, tribal water infrastructure, and tribal government costs (including tax administration)—with no per capita distributions to tribal members; the Tribe may delegate tax assessment, collection, and distribution to Riverside County via intergovernmental agreement, and other public agencies may enforce requirements in federal court (with tribal sovereign immunity waived for this purpose).

This section directs the Secretary of the Interior to hold approximately 2,742 acres of specified Bureau of Land Management land in Riverside County, California—in Sections 32 and 36, T.5S., R.4E.; Section 5, T.5S., R.4E.; Section 16, T.4S., R.4E.; portions of Sections 17 and 18, T.4S., R.4E., San Bernardino Base and Meridian—in trust for the Agua Caliente Band of Cahuilla Indians as part of its reservation upon the Enforceability Date, subject to valid existing rights and notwithstanding restrictions under section 714(b) of the California Desert Protection Act of 1994 (for portions of Section 18) and section 5(i)(1)(A) of the Santa Rosa and San Jacinto Mountains National Monument Act of 2000 (for Sections 5, 16, 32, and 36). (1) Existing authorizations on transferred lands remain in effect, with the Bureau of Indian Affairs assuming the prior agency's benefits and obligations and disbursing related revenues to the Tribe; (2) improvements constituting personal property under state law may be removed by holders within 90 days after expiration of authorizations (or longer if agreed with the Tribe), with unremoved property becoming the Tribe's and holders liable for removal costs; (3) upon enactment, the lands are withdrawn from public land laws, mining laws, and mineral/geothermal leasing; (4) technical corrections to land descriptions may be made with Tribal consent, and surveys (if requested) control acreage; (5) the Secretary must complete all transfers within 10 years of the Enforceability Date, with survey and administrative assistance from the Secretaries of the Interior and Agriculture as needed; and (6) the lands are ineligible for Class II or Class III gaming under the Indian Gaming Regulatory Act.

This section directs the Secretary of the Interior to convey all federal right, title, and interest in the Facility Land to the Coachella Valley Water District (CVWD)—notwithstanding Federal Land Policy and Management Act (FLPMA) land use planning requirements—if CVWD submits an offer at fair market value (FMV), as determined by appraisal, within 30 days after appraisal completion, with conveyance occurring within 30 days after the offer. The Secretary must complete the appraisal within 90 days after the Enforceability Date in accordance with FLPMA and uniform federal standards, with all appraisal and conveyance costs (including surveys) borne by CVWD, which must pay the FMV within 30 days after conveyance; proceeds are deposited in the Federal Land Deposit Account for use under the Federal Land Transaction Facilitation Act. This section further authorizes technical corrections to Facility Land descriptions with CVWD consent and requires CVWD, upon discovery of suspected Tribal Cultural Resources at the Facility or Adjacent Lands, to (1) immediately cease ground-disturbing activities in the vicinity until a conclusive determination or compliant treatment; (2) notify the Agua Caliente Band of Cahuilla Indians Director of Historic Preservation and General Counsel (and the County Coroner for human remains, covering coroner fees); and (3) if the Tribe is the most likely descendant, provide access for inspection and facilitate reburial at a mutually agreed, undisturbed on-site location if selected by the Tribe.

This section includes several miscellaneous provisions, including (1) a limited waiver of sovereign immunity by the United States, to the extent provided by federal law, for purposes of compelling compliance with the Act and the Agreement; (2) a statement that the Act establishes no standard for the quantification or litigation of federal reserved water rights or other Indian water claims of any other Indian tribe in any judicial or administrative proceeding; (3) a clarification that the Act does not quantify or diminish the water rights, claims, or entitlements of any other Indian tribe, band, or community other than the Agua Caliente Band of Cahuilla Indians; (4) a disclaimer that the Act does not establish the taxing authority of any other Indian tribe or preempt the taxing authority of any other water district, agency, state, or local government; (5) a rule that the Act controls in the event of a conflict with the Agreement; and (6) a preservation of current law (including regulations) on pre-enforcement review of federal environmental enforcement actions.

This section provides an antideficiency protection, stating that the United States is not liable for any failure to carry out obligations or activities authorized by this Act—including under the Agreement—if Congress does not expressly appropriate adequate funds.