Denver ? A settlement has been proposed that would end a 5-year-old lawsuit over Republican River water allocations involving Kansas, Nebraska and Colorado.

A special master overseeing the suit has recommended the U.S. Supreme Court approve the proposed settlement, Colorado officials said Monday.

If the agreement is finalized, it will save that state $5 million in litigation costs, Gov. Bill Owens and Atty. Gen. Ken Salazar said.

The U.S. Supreme Court appoints special masters to adjudicate interstate water disputes on its behalf.

Nebraska Atty. Gen. Jon Bruning said the settlement, which was reached in December but not immediately approved by the special master, was good for Nebraska.

“It gives Nebraska everything we could have hoped for,” Bruning said. “It saves Nebraskans millions of dollars from what Kansas had originally asked for.”

Under the settlement, Nebraska was basically asked to use water in a reasonable manner, which was what had been happening all along, he said.

The Republican River flows out of northeast Colorado, across northwestern Kansas and across southwestern Nebraska before re-entering Kansas just south of Superior, Neb.

Kansas sued Nebraska in the U.S. Supreme Court in 1998 over a compact that dates to 1943 spelling out the allocation of the Republican River water: Nebraska, 49 percent; Kansas, 40 percent; and Colorado 11 percent.

Kansas accused Nebraska of allowing irrigators to divert more than their legal share of the river’s water. Nebraska argued that groundwater use was not regulated by the compact because it was signed before deep-well irrigation was used in the river basin.

Colorado became a party to the lawsuit to protect its entitlement.

In August 2001, by separate stipulations between Colorado and Nebraska and Colorado and Kansas, it was agreed that no state would press claims against the other for violation of the compact between 1943 and 1994.

Under the proposed settlement, claims for damages against Colorado through 2002 would be waived, and the lawsuit against the state would be dismissed.

A computer model cooperatively designed by experts from all three states will determine what steps, if any, must be taken to keep water uses within the limits of the compact.

Salazar said the settlement was reached after less than four years, a short time frame in interstate water litigation.