The accord was expected to forestall litigation that was likely to arise as fast-growing states jockey for the best way to keep water flowing in the wake of the worst drought in a century, The New York Times reported Monday.

The agreement spells out how California, Arizona and Nevada will share the impact of water shortages. It establishes criteria for the Interior Department to declare a shortage on the Colorado River if the system is unable to produce enough water to supply 15 million homes for a year, the newspaper said.

It also puts in place new measures to encourage conservation and manage two primary reservoirs, Lake Mead in Nevada and Arizona and Lake Powell in Utah and Arizona, that have gone from nearly full to half-empty since 1999.

U.S. Interior Secretary Dirk Kempthorne was expected to sign the pact Thursday.