Article 4. Contracts Other Than With State Agencies of California Water Code >> Division 6. >> Part 3. >> Chapter 7. >> Article 4.

Any contract or lease made by the department with any person, other than a state agency, providing for the furnishing by the department of water, the use of water, water storage, electric power, or other service for resale shall be subject to cancellation by the department upon five years' notice, and such a contract or lease shall be so canceled in whole or in part whenever the State or any financially responsible state agency makes application for the water, use of water, water storage, electric power, or other service, or any part thereof, covered by the contract or lease and enters into a contract or lease binding itself to take the water, use of water, water storage, electric power, or other service, or any part thereof, and pay for it at a rate or price at least equal to that specified in the contract or lease to be canceled and for a period at least equal to the unexpired portion of the term of such contract or lease.

The department shall not cancel any contract or lease under the next preceding section unless and until it first determines and assures itself that notwithstanding the cancellation, it will receive and be paid a total revenue or consideration at least equal to that which would be received by it were the contract or lease not canceled, and within the unexpired portion of the term of the contract or lease.