The states also could bank "intentionally created surplus" water in Lake Mead by paying farmers to temporarily fallow their fields.

The arrangement could eventually provide the lake, at least temporarily, with as much as 2.1 million acre-feet of water that otherwise would be used or socked away elsewhere by the states.

North America's largest man-made reservoir could certainly use the help.

Since the current drought descended on the Colorado River in 2001, the water level in Lake Mead has dropped more than 100 feet.

The reservoir is now more than half empty. The water hasn't been this low since 1965, when river water was being withheld upstream to fill Lake Powell for the first time.

Under the new agreement, the Metropolitan Water District of Southern California, that state's largest municipal water supplier, will be able to store up to 1.5 million acre-feet in Lake Mead for future use. Nevada and Arizona each will be allowed to bank up to 300,000 acre-feet.

One acre-foot of water is roughly the amount used each year by two Las Vegas homes. It takes about 100,000 acre-feet to raise the surface of Lake Mead 12 inches.

By storing unused water there during dry years, the three lower basin states hope to stave off shortages that would be imposed if the lake drops 35 feet from its current level.

Keeping more water in the reservoir also would buy local water managers much-needed time to build a third straw to the deepest part of the lake.

The Las Vegas Valley currently draws about 90 percent of its drinking water supply from Lake Mead using two intake pipes, the shallowest of which could begin to fail if the lake is allowed to shrink an additional 60 feet.

But will the states, California in particular, take advantage of their new water savings account? Absolutely, said Pat Mulroy, general manager of the Southern Nevada Water Authority. "Met will start using it tomorrow."

Though "intentionally created surplus" water banked in Lake Mead can only be withdrawn gradually and cannot be taken during shortage years, Mulroy said, it will give her counterparts in California some added flexibility they desperately need right now.

"This could save Southern California," she said.

Although they welcome the new storage scheme, Metropolitan officials said they don't think they will be able to bank water in the lake as quickly as Mulroy and others are predicting.

"Unfortunately, we don't have a lot of (extra) water right now," said Metropolitan General Manager Jeffrey Kightlinger.

The shortage-sharing agreement enacted Thursday had been in the works since 2005. It lays out new rules for sharing shortages on the Colorado River and jointly operating Lake Mead and Lake Powell during extended dry spells.

During a speech moments before the pact was signed, Interior Secretary Dirk Kempthorne stressed the historic significance of the occasion.

"For the first time since 1922, all seven basin states have reached an agreement on the management of the Colorado River," he said. "I am convinced that 50 or 100 years from now, the people of the basin will look back on 2007 in the same way they do on 1922. This is truly historic."

Under the first round of shortages established by the agreement, Nevada, Arizona and Mexico would have to reduce their combined water use by 400,000 acre-feet a year should the lake drop 35 feet from its present elevation.

The shared shortage would grow to 500,000 acre-feet and then 600,000 acre-feet as the lake continued to drop.

Nevada's share of those shortages would start at 13,000 acre-feet and increase to 17,000 acre-feet and then 20,000 acre-feet.

Until now, there were no rules for operating the river during prolonged drought.

"We've just never faced shortages like this before," said Timothy Brick, chairman of Metropolitan's board of directors.

The overall pact comprises about two dozen smaller agreements and side deals. "Hundreds of pages would not be an exaggeration," water authority spokesman J.C. Davis said.

One key provision allows the Southern Nevada Water Authority to tap groundwater in Coyote Spring basin and surface water from the Virgin and Muddy rivers and take it out of Lake Mead for use in Las Vegas, even during a shortage. That portion of the deal could increase the valley's water supply by about 40,000 acre-feet a year.

The water authority also would gain access to a one-time reserve of at least 400,000 acre-feet of Colorado River water in exchange for building a reservoir in California that could cost as much as $206 million.

The 8,000-acre-foot reservoir would be used to capture water that now flows across the border into Mexico but does not count against that country's annual share of the Colorado River.

Kempthorne and representatives from the seven western states that share the river signed the landmark agreement Thursday morning, during the annual conference of the Colorado River Water Users Association at Caesars Palace.

The audience of several hundred water managers greeted the signing of the document with a standing ovation.

"It's been a long, hard road," Mulroy said later. "I'm elated."

Contact reporter Henry Brean at hbrean@reviewjournal.com or (702) 383-0350.