But whether they make enough progress to present a formal proposal to Interior Secretary Gale Norton by next spring's federally imposed deadline is another question. Norton is scheduled to address the Colorado River Water Users Association conference on Friday.

"I'm optimistic something can get done, but a lot of work still has to happen and a lot of movement has to take place. By no means is it a sure thing," Don Ostler, executive director of the Upper Colorado River Commission, said Tuesday.

The Colorado River's upper and lower basin states - Utah, Wyoming, Colorado and New Mexico comprise the upper basin; Nevada, Arizona and California the lower - have been squabbling since last year's Vegas meetings over new shortage criteria on the river under drought conditions.

When they were unable to forge a deal last spring, Norton interceded and ruled that the lower basin would receive its usual allotment of 8.23 million acre-feet of water out of Lake Powell. The upper basin states had argued for a lesser amount, in a bid to replenish the drought-depleted reservoir.

Since then, officials from the seven basin states have been meeting regularly. Last August they reached agreement on a general set of principles about how the river should be managed during low-reservoir years. And they go into this week's conference armed with computer modeling data that shows how various shortage scenarios could play out.

In broader terms, the seven basin states are negotiating a way to coordinate operations of the two reservoirs, bringing some flexibility to how water is allotted from the upper basin to the lower basin, beyond the rigid guidelines of the Colorado Compact.

"We're trying to develop an operation that will be good for both basins," said Larry Anderson, director of Utah's Division of Water Resources. "We're not there yet, but we're closer than we were."

Driving the the discussions is the specter of a "call" by the lower basin states for upper basin river water that is guaranteed by the Colorado Compact. If such a call were to occur during low reservoir conditions, a protracted legal battle would almost certainly ensue.

That scenario would be bad for everybody, says Ostler, because of the time and expense involved. But he also says the stakes are too high for the upper basin states to back down.

"The lower basin is fully developed, the upper basin is not. By all rights, we should be able to develop water resources that we have yet to use," Ostler said, citing projects like the Lake Powell pipeline and potential oil shale development. "The lower basin is maxed out, but they're continuing to grow. Something has got to be done."

jbaird@sltrib.com