Federal legislation needed to implement a legal settlement for the restoration has been hung up for two years by concerns from various parties.

Feinstein told The Associated Press on Tuesday that she had brokered a final agreement with all the parties – including environmental and fishing groups, farmers, irrigation districts and federal agencies – that could get lawmakers' approval during a lame-duck session of Congress expected to begin next week.

“I think everybody realizes that this has been an 18-year fight,” Feinstein said. “Now that everybody's on the same page, my view is that we should pass this bill, as it is, as early as we can.”

The legislation would implement a settlement that would return water to a dry 60-mile stretch of the San Joaquin River by 2009 and bring back Chinook salmon no later than Dec. 31, 2012.

The San Joaquin is California's second-longest river. The lawsuit stems from the opening of Friant Dam in 1949, which transformed the San Joaquin Valley's main artery from a river thick with salmon into an irrigation powerhouse for more than a million acres of farmland.

Under the 2006 settlement, the Friant Water Users Authority, which represents 21 irrigation districts that distribute river water to thousands of farms, agreed to relinquish a set portion of their traditional water supplies to help restore the fish.

Friant officials viewed that as preferable to letting a judge rule how much water should be released down the old river bed. California farmers are already facing cutbacks in water supplies following two years of dry weather.

Negotiators said the new agreement also resolves the concerns of land owners downstream from the dam, who wanted assurances that their farms wouldn't be flooded or otherwise harmed by the new water releases.

“This process has not been easy, but the future of California agriculture rests on our ability to find solutions,” said Rep. George Radanovich, R-Mariposa, who represents areas of the San Joaquin Valley affected by the legislation. “We cannot afford to do nothing and allow the courts to be river masters.”

Various disputes erupted that stalled a final deal, including how to satisfy congressional “pay as you go” rules that require a loss to the U.S. Treasury to be offset by other income.

The total cost of the bill has been disputed, but plaintiffs with the Natural Resources Defense Council estimate it at between $250 million to $800 million.

Under the deal Feinstein announced Tuesday, Friant water districts will over the next 10 years pay back about $200 million they owe the federal government for building the pumps, reservoirs and canals attached to the Central Valley Project, plus $100 million for restoration efforts.

The state has committed an additional $200 million in bond revenue, bringing the total restoration funding for the next decade to about $500 million, said attorney Hal Candee, lead negotiator for the NRDC.

“This is the last piece that was needed in order to fully implement this historic accord,” said Ron Jacobsma, general manager with the Friant Water Users Authority. “This will help set the stage to overcome protracted litigation and uncertainty in resolving other environmental and water supply issues in the West.”

Feinstein said she hopes to get the deal through Congress during its lame-duck session as part of a larger package of public lands bills currently pending in the Senate, but it still would have to pass the House before going to President Bush for his signature.

If that doesn't work, the bill would need to be reintroduced next year, when Congress reconvenes in January under an Obama administration.

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Associated Press writer Erica Werner in Washington contributed to this report.