A bill to amend the Act of July 28, 1954 (68 Stat. 575), to authorize the Secretary of the Interior to construct, operate, and maintain the Santa Margarita project, California, and for other purposes.

(Reported to Senate from the Committee on Energy and Natural Resources with amendment, S. Rept. 98-139)

Amends Federal Law to authorize the Secretary of the Interior to construct, operate, and maintain the Santa Margarita project in California. States that the project shall consist of the Fallbrook and DeLuz Dams and Reservoirs and pipelines, regulation facilities, or other facilities required to provide water to the Fallbrook Public Utility District and the Marine Corps base at Camp Pendleton.

States that the appropriation of construction funds is contingent upon a secretarial determination of economic justification and compliance with appropriate environmental laws. Requires that any modifications of the plan for certain purposes be implemented only with the concurrence of the Secretary of the Navy. Requires the Secretary of the Interior to determine certain interest rates related to the project.

Requires the Secretary to enter into contracts with certain entities, including the Department of the Navy, for the delivery of project water and for repayment of the reimbursable construction costs.

Requires proceeds from the sale of surplus project water entitled to the Department of the Navy to be credited to such Department.

Requires that the conservation and development of fish and wildlife resources and the enhancement of recreation opportunities in connection with this project be in accordance with the Federal Water Project Recreation Act.

Authorizes appropriations for the construction of the Santa Margarita project beginning October 1, 1983.