(1) It is the policy of the department to negotiate a water marketing contract prior to the expiration of an existing water marketing contract with the water users' association and, in the case of a public agency, to negotiate a water purchase contract with the holder of a water purchase contract for instream flow, on a project pursuant to the mandates and provisions of 85-1-211 , MCA.

(2) It is the further policy of the department to recognize in its negotiations the historical importance of irrigated agriculture to the economy of Montana and the historical purposes of the project.

(3) In recognition of the policy established in (2) , it is the further policy of the department not to use competitive bidding in the negotiation of the water marketing contract or a water purchase contract.