To provide for the transfer of the Platoro Reservior to the Conejos Water Conservancy District of the State of Colorado and for the protection of fish and wildlife habitat on the Conejos River.

Directs the Secretary of the Interior to: (1) accept a one-time payment from the Conejos Water Conservancy District, Colorado, in lieu of certain repayment obligations; and (2) enter into an agreement for the transfer of the operation and maintenance functions of the Platoro Dam and Reservoir, including flood control operations, to such District. Provides that title to the Dam and Reservoir and authority over its recreational use shall remain with the United States.

Subjects such transfer to the following conditions: (1) that releases from the Reservoir flush out the channel of the Conejos River periodically to maintain the hydrologic regime of the River; (2) that releases from the Reservoir contribute to even water flows in the fall season for protection of the brown trout spawn; (3) that operation of the Dam and Reservoir for water supply uses shall be paramount to channel flushing and fishery objectives; (4) that the District maintain a permanent pool in the Reservoir for fish, wildlife, and recreational purposes; (5) that the District shall maintain specified releases of water from October through April and shall bypass a specified amount or natural inflow, whichever is less, from May through September; and (6) that the U.S. Forest Service shall regularly monitor operation of the Reservoir.

Requires the Corps of Engineers to retain authority for the operation of the Dam and Reservoir for flood control purposes.

Requires the transfer to be in compliance with the Rio Grande Compact of 1939 and all other applicable laws and regulations.