The U.S. Senate has approved legislation to resolve a long-standing dispute over how much Arizona owes the federal government for construction of the enormous canal system that moves Colorado River water to the state's thirsty central and southern cities.

The bill also settles Indian water rights, some of which have been in dispute for decades.

"It's the biggest water settlement in the history of the United States," Sen. Jon Kyl said Monday of the bill passed by the Senate on Sunday. The House is expected to vote on the measure after the November election.

The legislation resolves a complicated web of disputes and claims by dozens of parties.

"The gist of the bill is that it will settle long-standing disputes between Arizona and the United States government about how much we need to repay for construction of the Central Arizona Project and claims by the Gila River Indian Community and the Tohono O'odham Nation to water," said Kyl, a Republican.

"And the certainty that the settlement provides will enable cities, towns, irrigation districts, Indian communities and others to know what their water rights are in the future, and to be able to plan accordingly."

The settlement will give the tribes a way to exercise water rights that until now have existed essentially in name only, while ending disagreement between Arizona and the federal government concerning nearly $2 billion in CAP construction repayments.

The bill has four major components, with the first clearing up repayment and how project water is allocated between federal and state interests. It also creates a fund for current and future Indian water settlements - the Lower Basin Fund - Kyl said.

The second prong will resolve claims of the Gila River Indian Community, ending litigation dating to 1974. It will provide the tribe with CAP water to supplement water on the reservation and to help satisfy the tribe's budgeted 645,000 acre-feet of water annually.

In addition, the tribe will benefit from money to be placed into the Lower Basin Fund, since about $1.65 billion in Central Arizona Project water user fees to repay the federal construction costs will be kept in it, the senator said.

That money will be used to build Gila River tribal irrigation projects to reduce the cost of water to the tribe and to pay for other elements of the settlement, Kyl said. The tribe will use some of the funds to rebuild an 80-year-old irrigation system.

The settlement provided for a guarantee to the tribe of 2.1 billion gallons of CAP water, primarily for farming. But the tribe would have the option of leasing water back to cities in Arizona.

The third part of the settlement will amend the Southern Arizona Water Rights Settlement Act of 1982 and resolve Tohono O'odham water claims, guaranteeing the tribe 28,000 acre-feet of water.

The last portion concerns the San Carlos Apache Tribe, Kyl said.

The 336-mile Central Arizona Project canal was built at a cost of about $4.5 billion to deliver water from the Colorado River to cities in the Phoenix area and Tucson.