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Since, however, during recent hearings in the Senate, Arizona supported pending legislation to authorize the Central Arizona Project which includes Hooker Dam as an integral feature thereof, the report has proposed authorization of Hooker Dam with the expectation that Arizona and New Mexico interests will enter into the necessary agreements. The United States would be a necessary party to any agreements and would not support, however, any agreements that did not protect the rights of all existing users to the water to be impounded. 7. Canal Lining California has recommended that lining of canals in the Imperial and Coachella Valleys should be placed in Phase I, or the immediate-authorization program. There can be no question that lining of these canals is one of the most economical means of increasing the effective water supply of the Pacific Southwest. It is estimated that 500,000 acre-feet of water could be conserved annually by this means. Water now diverted through these canals is diverted under contracts with the Secretary of the Interior. It is part of California's share of Colorado River water and enjoys a relatively high priority as against other uses from the Colorado River in California. The priorities contained in the contracts are consistent with those agreed to by all California contractors for use of Colorado River water under the so-called "Seven Party Priority Agreement," dated August 18, 1931. Before the Federal Government should participate in a canal lining program, however, the problem of the disposition of the conserved water 47Epson Perfection 4870 Photo, 400 dpi, 8 bit, 14,260,224 byte