[Senate Hearing 112-129]
[From the U.S. Government Publishing Office]
S. Hrg. 112-129
WATER AND POWER BILLS
=======================================================================
HEARING
before the
SUBCOMMITTEE ON WATER AND POWER
of the
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED TWELFTH CONGRESS
FIRST SESSION
ON
S. 500 S. 715
S. 802 S. 997
S. 1033 S. 1047
S. 1224 S. 1225
__________
JUNE 23, 2011
Printed for the use of the
Committee on Energy and Natural Resources
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
JEFF BINGAMAN, New Mexico, Chairman
RON WYDEN, Oregon LISA MURKOWSKI, Alaska
TIM JOHNSON, South Dakota JOHN BARRASSO, Wyoming
MARY L. LANDRIEU, Louisiana JAMES E. RISCH, Idaho
MARIA CANTWELL, Washington MIKE LEE, Utah
BERNARD SANDERS, Vermont RAND PAUL, Kentucky
DEBBIE STABENOW, Michigan DANIEL COATS, Indiana
MARK UDALL, Colorado ROB PORTMAN, Ohio
JEANNE SHAHEEN, New Hampshire JOHN HOEVEN, North Dakota
AL FRANKEN, Minnesota DEAN HELLER, Nevada
JOE MANCHIN, III, West Virginia BOB CORKER, Tennessee
CHRISTOPHER A. COONS, Delaware
Robert M. Simon, Staff Director
Sam E. Fowler, Chief Counsel
McKie Campbell, Republican Staff Director
Karen K. Billups, Republican Chief Counsel
------
Subcommittee on Water and Power
JEANNE SHAHEEN, New Hampshire, Chairman
RON WYDEN, Oregon MIKE LEE, Utah, Ranking
TIM JOHNSON, South Dakota JAMES E. RISCH, Idaho
MARIA CANTWELL, Washington DANIEL COATS, Indiana
BERNARD SANDERS, Vermont JOHN HOEVEN, North Dakota
DEBBIE STABENOW, Michigan DEAN HELLER, Nevada
JOE MANCHIN, III, West Virginia BOB CORKER, Tennessee
Jeff Bingaman and Lisa Murkowski are Ex Officio Members of the
Subcommittee
C O N T E N T S
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STATEMENTS
Page
Barlow, Richard J., First Selectman, Town of Canton,
Collinsville, CT............................................... 19
Blumenthal, Hon. Richard, U.S. Senator From Connecticut.......... 3
Katz, John, Deputy Associate General Counsel, Federal Energy
Regulatory Commission.......................................... 17
Lee, Hon. Mike, U.S. Senator From Utah........................... 3
Payne, Grayford F., Deputy Commissioner for Policy,
Administration and Budget, Bureau of Reclamation, Department of
the Interior................................................... 7
Shaheen, Hon. Jeanne, U.S. Senator From New Hampshire............ 1
Udall, Hon. Mark, U.S. Senator From Colorado..................... 5
Appendix I
Responses to additional questions................................ 31
Appendix II
Additional material submitted for the record..................... 41
WATER AND POWER BILLS
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THURSDAY, JUNE 23, 2011
U.S. Senate,
Subcommittee on Water and Power,
Committee on Energy and Natural Resources,
Washington, DC.
The committee met, pursuant to notice, at 2:33 p.m. in room
SD-366, Dirksen Senate Office Building, Hon. Jeanne Shaheen
presiding.
OPENING STATEMENT OF HON. JEANNE SHAHEEN,
U.S. SENATOR FROM NEW HAMPSHIRE
Senator Shaheen. Good afternoon, everybody. Hopefully that
woke you all up. I want to call to order this hearing before
the Water and Power Subcommittee and welcome everyone here this
afternoon.
Senator Lee, our ranking member, we think is on his way,
but we'll go ahead and begin since we have Senator Blumenthal
here, and we know he has a very busy schedule.
Today's hearing involves 8 bills that are pending before
the subcommittee. The bills cover several different aspects of
our water and power jurisdiction. Some of the bills are similar
to bills that we heard during the last Congress, and others
we're hearing about for the first time today.
The bills we're covering today are: S. 500, the South Utah
Valley Electric Conveyance Act, relating to facilities in Utah;
S. 715, the Collinsville Renewable Energy Promotion Act,
relating to a hydroelectric project in Connecticut; S. 802, the
Lake Thunderbird Efficient Use Act of 2011, addressing water
supply needs in Oklahoma; S. 997, the East Bench Irrigation
District Water Contract Extension Act, relating to a water
supply contract in Montana; S. 1033, to authorize the Secretary
of the Interior to participate in the city of Hermiston,
Oregon's water recycling and reuse project; S. 1047, the
Leadville Mine Drainage Tunnel Act of 2011, addressing a
situation in Colorado; S. 1224, the Bureau of Reclamation Fish
Recovery Programs Reauthorization Act of 2011, which supports
water supply projects in Wyoming, Utah, Colorado, and New
Mexico; and S. 1225, the Fort Sumner Project Title Conveyance
Act, relating to an irrigation project in New Mexico.
I look forward to hearing about these bills.
Now that Senator Lee has arrived, I'll ask if he has any
opening comments.
Senator Lee.
[The prepared statements of Senators Lieberman and
Inhofe follow:]
Prepared Statement of Hon. Joseph Lieberman, U.S. Senator From
Connecticut, on S. 715
Thank you, Madame Chairman. I am grateful for the
opportunity to provide a statement in support of this important
legislation, and I am pleased that the Subcommittee saw fit to
invite the distinguished First Selectman of Canton,
Connecticut, Richard Barlow, to testify on behalf of this
legislation.
In April, I, along with my colleague Senator Blumenthal,
reintroduced legislation that would expedite the remaining
regulatory process and minimize the costs of obtaining the
final FERC permits for reactivating the two Collinsville Dams.
Representative Chris Murphy has introduced companion
legislation in the House. The Upper and Lower Collinsville Dams
are two inactive masonry hydroelectric dams owned by the
Connecticut Department of Environmental Protection and located
two miles apart on the Farmington River in the central
Connecticut communities of Canton, Burlington, and Avon.
Following FERC's termination of a previously awarded
license as a result of failure by a private developer to
commence construction, the town of Canton approached the
delegation with the idea to have the licenses reinstated and
transferred to the town of Canton. The town would then work
with the towns of Avon and Burlington. With the reactivation
and repowering of these dams, they could provide municipally
operated power, eventually generating around 2 megawatts of
electricity, which is enough power to generate around 2,000
homes in the nearby communities.
Not only would this legislation accelerate the
reinstatement of the FERC licenses, but it would also direct
FERC to conduct a supplemental Environmental Assessment on both
dams. These new assessments are supported by various river
groups, including American Rivers and the Lower Farmington
River/Salmon Brook Wild and Scenic Study Committee, as they
would pave the way for improvements in fish passages at both
dams.
This legislation was the product of careful and inclusive
negotiations between the Congressional delegation, affected
communities, the state Department of Environmental Protection,
and local and national environmental groups. It is
representative of an important effort to provide clean,
renewable energy in an environmentally sustainable way, all
with local support.
I am privileged to support this legislation along with my
colleagues Senator Blumenthal and Representative Murphy. At a
time of rising energy prices, the legislation will help make
the Farmington River Valley more energy independent, while at
the same time providing for safer passage for the fish that are
so important to the area. Thank you, Madame Chairman.
------
Prepared Statement of Hon. James M. Inhofe, U.S. Senator From Oklahoma
I am writing to thank you for holding a hearing on S. 802
in the Subcommittee on Water and Power in the Committee on
Energy and Natural Resources. The Lake Thunderbird Efficient
Use Act of 2011 is an important piece of legislation to me and
many Oklahomans.
This bill allows the Central Oklahoma Master Conservancy
District to import and store non-project water into Lake
Thunderbird, if the Secretary of the Interior determines there
is enough capacity to do so. Allowing additional water to be
stored at Lake Thunderbird would help increase municipal and
industrial supplies for the cities served by the District,
which include Norman, Midwest City, and Del City.
It will ensure greater access to water supplies for a
growing metropolitan area. Over the last decade, the Norman
area grew by 15%, making it one of the fastest growing areas in
the state of Oklahoma. As this area continues to grow there
will be a greater need for access to the water supplies to the
Lake Thunderbird reservoir. Fortunately, no funds need be
expended to accomplish this goal. It will cost the taxpayers
nothing.
I respectfully ask that the bill be favorably reported
fromt he Subcommittee to the full Committee on Energy and
Natural Resources. I further ask for swift Committee
consideration so the bill can be allowed to pass the Senate.
Thank you for your attention to this matter.
STATEMENT OF HON. MIKE LEE, U.S. SENATOR FROM UTAH
Senator Lee. Thank you, Senator Shaheen. It's a pleasure to
be here today, and I thank you for chairing this hearing on a
number of water and power measures, one of which is integral to
my home state of Utah, S. 500, the South Utah Valley Electric
Conveyance Act. I've co-sponsored this bill with my colleague,
Senator Hatch, from Utah.
Similar to the legislative hearing that we held last month,
all of the bills before us today address many of the issues
that we'll be examining over the next few years in the
subcommittee, and those issues include opportunities to improve
the storage and transfer amongst various different water users;
different approaches to resolve jurisdictional issues among
Federal agencies to avoid duplication both in cost and in
efforts; and opportunities to improve our power supplies, which
is always important to Americans, and especially so right now.
So while the underlying purpose of each bill before us
today may be different, each of these bills attempt in some way
or another to identify tools to help ensure that our water and
our power facilities are safe and reliable and are being
managed effectively.
I thank the Federal witnesses for their presence here today
and their participation. Thank you, Senator Shaheen, for
conducting this hearing. I look forward to the testimony we'll
be hearing.
Senator Shaheen. Thank you very much, Senator Lee.
Senator Udall has also arrived and would like to make a
statement, but he has said he's fine with Senator Blumenthal
going first.
So, Senator Blumenthal, we're delighted you're here. I'm
especially delighted you're here to have somebody speak to an
Eastern water issue, as opposed to just the West.
So at this time, we'd like you to go ahead and testify.
STATEMENT OF HON. RICHARD BLUMENTHAL, U.S. SENATOR
FROM CONNECTICUT
Senator Blumenthal. Madam Chairwoman, I'd be happy to yield
to Senator Udall. If he's on a tight schedule and he wants to
make a quick statement, I'm happy to have him go first.
Senator Udall. I'd love to hear the senator talk about the
Eastern waters.
Senator Shaheen. Good. Please go ahead, Senator Blumenthal.
Senator Blumenthal. Thank you.
First of all, thank you to Chairwoman Shaheen and to
Ranking Member Lee for giving me this opportunity to testify
today.
I think all the members of this panel, but most
particularly Senator Shaheen will have sympathy for the cause
that I bring to this committee because she has done such
wonderful work on renewable energy in the neighboring state of
New Hampshire. Indeed, I am here to advocate for a bill that
would enable the Federal Energy Regulatory Commission to
reinstate the license necessary for the Town of Canton,
Connecticut to operate 2 hydroelectric dams on the Farmington
River.
I know that New Hampshire probably has dams like this one
that once provided electric power to a thriving axe factory on
the Farmington River, and the factories that it once served
have gone silent, but we have an opportunity to ensure that the
Collinsville dams are once again able to provide clean,
renewable energy to families and businesses along the
Farmington River.
I want to thank in particular Senator Lieberman, who is an
author of S. 715. He's unable to be here today, but I know he
shares my strong support for this legislation.
I also want to thank First Selectman Dick Barlow of Canton,
who is here today. He's been a champion of this issue. He is a
former 3-year public servant at the Department of Environmental
Protection in the State of Connecticut, and he's worked
tirelessly to promote cooperative, municipally owned sources of
clean, renewable energy for Connecticut communities such as
Canton, Avon, and Burlington, which will be served by these
hydroelectric dams.
Very simply and briefly, Chairman Shaheen, this bill will
enable the Upper and Lower Collinsville Dams, which have been
dormant since the 1960s, to have their licenses reinstated by
the Federal Energy Regulatory Commission. They were granted
licenses for a former owner in 2001. The licenses were renewed
at the end of their-year period for 2 years and then revoked,
in effect, in 2007, at the end of a 6-year period because the
then-private developer was essentially inactive in going
forward, and the state legislature in Connecticut passed the
necessary statutes to operate the 2 dams and in effect transfer
their ownership to the Town of Canton, which now seeks to
operate them, and that's why we're here today, to enable Canton
to have those licenses that are necessary, to reinstate them so
that they can go forward.
I want to make very clear, there are conditions that would
be followed. First of all, the normal environmental process,
including environmental assessments that are necessary, and
also a comment period for any interested party would go forward
in the course of FERC's reinstating these licenses.
The reason that the hydro, the small hydropower exemption
cannot be relied upon here is simply that the time and expense
necessary to go through it, and the authority necessary for it
to proceed expeditiously we believe can best be created by this
Congress through the legislation, and there is precedent for
the Congress having done exactly what we're asking it to do
through this measure.
In 2003, the 108th Congress adopted a measure reinstating
the FERC license for a similarly sized, small hydroelectric dam
in Stuyvesant, New York. I recognize we don't have any senator
from New York here today, but similarly the inactive license
there had been held by a private firm and transferred to a
public entity.
So I'm here today very simply to ask this subcommittee and
then the committee as a whole to approve this measure so that
the Town of Canton can have a reinstated license to provide
clean, renewable energy to a number of towns, communities,
small businesses in the area on the Farmington River. Thank you
very much.
[The prepared statement of Senator Blumenthal follows:]
Prepared Statement of Hon. Richard Blumenthal, U.S. Senator
From Connecticut
on s. 715
Thank you, Chairman Shaheen and Ranking Member Lee for allowing me
to testify today. I also would like to thank Senator Lieberman, the
author of S. 715. He is unable to be here today, but I know that he
shares my strong support of this legislation and its goal of allowing
the town of Canton, Connecticut to operate two hydroelectric dams on
the Farmington River. I would also like to recognize a witness
appearing in the second panel, First Selectman Dick Barlow of Canton.
He has been a champion of this issue and has worked tirelessly to
promote a cooperative, municipally-owned source of clean renewable
energy for the Connecticut communities of Canton, Avon and Burlington.
S. 715 will allow the residents of Connecticut's Farmington Valley
to take two existing, but inoperative, hydroelectric dams and use them
to provide clean, renewable energy for hundreds of Connecticut
homeowners. The legislation has no direct cost to the federal
government.
The Upper and Lower Collinsville dams have been dormant since the
1960s. The licenses previously issued by FERC to operate these dams are
currently inactive, and this legislation would allow FERC to reinstate
them and transfer them to the town of Canton, Connecticut, for
operation, after a thorough environmental review and public comment
period.
The State legislature has already passed legislation to operate
these two State-owned dams, but Federal legislation is also needed to
restore their operation.
By allowing FERC to review and reinstate a terminated set of
existing licenses, we can move this project forward, while also
ensuring that FERC's licensing process remains rigorous and that the
environment of the Farmington River is protected. This legislation
requires FERC to undertake its normal environmental review process and
also requires FERC to provide an opportunity for comment by any
interested parties prior to taking any action on the licenses.
S. 715 was drafted with the cooperation of FERC and state and local
stakeholders, including the towns of Canton, Burlington, and Avon, the
local watershed organization, the local Wild & Scenic River Study
Committee, and the state Department of Environmental Protection.
Support among affected stakeholders is bipartisan and nearly universal.
There is broad agreement that these dams can be a great source of
renewable energy in the heart of Connecticut.
In their heyday, these two small dams were used to provide
electrical power to a thriving axe factory nearby. And although the
factories have gone silent, we have an opportunity today to ensure that
the Collinsville Dams are once again able to provide clean, renewable
energy to the families and businesses along the Farmington River.
Thank you for allowing me to testify today, and I welcome your
questions.
Senator Shaheen. Thank you, Senator Blumenthal.
Did you have any questions for the Senator?
We appreciate your testimony, and I think we will go ahead
and call the second panel up at this point.
While you're coming forward, Senator Udall, can we ask you
to go ahead and make your statement?
Senator Blumenthal. Thank you.
Senator Shaheen. Thank you.
STATEMENT OF HON. MARK UDALL, U.S. SENATOR
FROM COLORADO
Senator Udall. Thank you, Senator Shaheen. Thank you,
Ranking Member Lee, for giving me a piece of time just to
comment on a piece of legislation I have before the
subcommittee, and that's S. 1047, the Leadville Mine Drainage
Tunnel Remediation Act of 2011.
I think, as the committee staff certainly knows, we've got
a mine drainage tunnel in Leadville, Colorado that's been the
source of some considerable worry for the surrounding community
for some time; in fact, for, over 30 years.
The Leadville Mine Drainage Tunnel is owned and operated by
the Bureau of Reclamation. It overlaps with the California Gold
Superfund site where the Environmental Protection Agency is
cleaning up historic mine waste. I'd like to add an incidental
note here. The EPA just recently announced that it plans to
delete one of the operable units of this Superfund site from
the National Priorities List. This is really encouraging news,
and I want to commend the EPA for their ongoing clean-up work.
Back to the tunnel. In 2007 and 2008, there was a collapse
in the Leadville Mine Drainage Tunnel that blocked the tunnel,
and then that caused a tremendous amount of water to build up.
Had that water pressure caused a blowout of the tunnel, it
would have been truly catastrophic because the community of
Leadville and then the entire Arkansas River Basin would have
been at risk from millions of gallons of water contaminated
with mine waste.
The Bureau of Rec and the EPA took emergency actions that
eventually stabilized the situation, but in the process we had
concerns that the Bureau lacked the necessary authority to
implement a permanent solution. So in short, Madam Chairwoman,
in the process of addressing what was literally physical
blockages within the tunnel, we found there were legal
blockages as well.
So the legislation I've introduced again in this Congress
clarifies that the Bureau has the authority to treat this water
that's diverted into the tunnel and, if necessary, to expand
the treatment plant that's already onsite to treat any
additional water.
It also requires the Bureau to maintain the structural
integrity of the tunnel to prevent a similar situation from
occurring in the future.
Last, it creates a framework for a cooperative action among
the Federal agencies, particularly the Bureau of Reclamation
and the EPA, at the tunnel.
I want to say I'm reassured by the Bureau's 2008 risk
assessment that found the tunnel poses no immediate danger, and
I'm also reassured by the EPA's new clean-up plan for the site
that should reduce the amount of contaminated water that's
entering the tunnel in the first place.
But I want to ensure that such favorable conditions
continue into the future, and that's what this legislation is
designed to do. By resolving the question of legal authority
and responsibility for the tunnel once and for all, it's my
hope that the people of Leadville will have an additional
measure of certainty that the Federal Government will maintain
safe conditions at the tunnel in perpetuity.
Now, I've been negotiating with the Bureau and the EPA over
the past year to allay as many of their concerns with the bill
as possible. I have to say--I want to be respectful, but I want
to be firm--that this issue is long overdue for resolution, and
the people of Leadville deserve at least that from us.
I'm an eternal optimist. I know this is a good bill, I know
the Senate would approve it, and I want to continue to work
with the administration to understand their remaining
objections.
Madam Chair, if you'd indulge me, I want to just comment on
another piece of legislation before the committee. That's
Senator Bingaman's Bureau of Reclamation Fish Recovery
Program's Reauthorization Act of 2011. I'm pleased and proud to
be a co-sponsor of the legislation. It is critical legislation.
It ensures that 2 exemplary conservation programs continue to
benefit the Upper Basin of the Colorado River, which Senator
Lee and I both are residents of the Upper Basin of the Colorado
River.
These are 2 highly successful programs. They are model
collaborative efforts between the Federal Government, States,
tribes, environmental interests and water users. It expires,
the authorization does, at the end of this year. So Senator
Bingaman's legislation simply extends that authorization. I
want to thank him for introducing the bill. I look forward to
working with him.
Again, Chairwoman Shaheen, Ranking Member Lee, thanks for
making a little time for me to participate. Thank you.
Senator Shaheen. Thank you very much, Senator Udall.
Now we'll go to our panel. Here with us this afternoon we
have 2 witnesses from the administration.
The first is John Katz, who is an attorney from the Federal
Energy Regulatory Commission. Mr. Katz will testify regarding
S. 715, the Collinsville hydropower bill.
We also have Grayford Payne, who is the Deputy Commissioner
for Policy, Administration and Budget from the Bureau of
Reclamation.
Thank you both for being here.
To speak to the Collinsville bill, we also have Mr. Richard
Barlow from the Town of Canton, Connecticut.
So thank you for being here, as well.
Mr. Payne, I'm going to ask if you would begin by
summarizing your written testimony, and we've actually allotted
10 minutes for you, Mr. Payne, because you're going to be
addressing so many of these bills. When we hear from Mr. Katz
and Mr. Barlow, we're not going to give you 10 minutes. We will
ask that you limit your remarks to about 5 minutes.
So if you would like to begin, Mr. Payne.
STATEMENT OF GRAYFORD F. PAYNE, DEPUTY COMMISSIONER FOR POLICY,
ADMINISTRATION AND BUDGET, BUREAU OF RECLAMATION, DEPARTMENT OF
THE INTERIOR
Mr. Payne. Thank you, Madam Chairman, Chairwoman.
Chairwoman Shaheen and members of the subcommittee, I'm
Grayford Payne. I'm the Deputy Commissioner of Policy,
Administration and Budget at the Bureau of Reclamation. I'm
pleased to provide the Department of the Interior's view on 7
bills before the subcommittee today: S. 500, S. 802, S. 997, S.
1033, S. 1047, S. 1224, and S. 1225. My written statements have
been submitted for the record.
Let's begin with S. 500, which I understand you are a co-
sponsor of, Senator Lee. The South Utah Valley Electric
Conveyance Act directs that the Secretary of the Interior shall
convey and assign components of the Strawberry Valley Project
Electric Distribution System to the South Utah Valley Electric
Distribution District.
The Department supports the transfer contemplated in this
bill and has 2 straightforward revisions to recommend. First we
recommend Section 3(a) changes, the phrase ``the Secretary
shall convey'' to be changed to ``the Secretary is authorized
to convey,'' thereby allowing for the completion of the
necessary public input and scoping pursuant to the National
Environmental Policy Act.
The second language change should add to state that the
District should hold the United States harmless to any claims
arising from the 1986 sale of the distribution system and from
actions under this legislation.
My written statements provide more details which we can
discuss further. Meanwhile, we look forward to moving this
transfer to the point where the Department can support the
legislation.
S. 802, Lake Thunderbird Efficiency Use Act, authorizes the
Secretary of the Interior to allow the storage and conveyance
of non-Project water at the Norman Project in Oklahoma. The
Department supports this bill.
Under the current law, Reclamation does not have the
authority to approve storage of non-Project water because the
purchased water does not originate from the Lake Thunderbird
watershed. It requires authority--if the required authority was
in place, Reclamation could approve a water service contract
and provide the means for the action to move forward. The
Department supports this legislation.
S. 997, the East Bench Irrigation District Water Contract
Extension Act, authorizes the Secretary of the Interior to
extend a contract for water services between the United States
and the East Bench Irrigation District. The Department supports
S. 997.
The District's water service contract with Reclamation was
first executed in 1958 and expired in 2005. Pursuant to state
law, execution of a new contract between the United States and
any Montana irrigation district requires a state court to
create.
In 2006, the District filed a petition with the court
seeking confirmation of the execution of their new proposed
renewed contract with Reclamation. For reasons described in my
written testimony, no court decree confirming the 2006 contract
has been issued. So the contract is not binding until the court
confirmation is secured. Therefore, the District is seeking
authorization under this legislation to extend the 1958
contract.
S. 997 would extend the contract for 4 years or until a new
contract is executed and still defer to the court to take up
the issue again at the time of its choosing. The Department
supports this legislation because it would allow water service
to the District to continue and protect the rights for contract
renewal while the court confirmation process is given time to
complete.
S. 1033, the city of Hermiston, Oregon Water Recycling and
Reuse Project, would amend the Reclamation Wastewater and
Groundwater Study and Facilities Act, commonly called Title 16,
to authorize the Secretary of the Interior to participate in
the design, planning and construction of permanent facilities
needed to reclaim and reuse water in the city of Hermiston,
Oregon. The Department cannot support this bill.
We recognize that the water reuse is an essential tool in
stretching the limited water supply in the West. However, given
that there are already 53 authorized Title 16 projects and
numerous competing demands on Reclamation's budget, the
Department cannot support the authorization of new Title 16
projects at this time.
Reclamation will, however, continue to work with project
proponents to evaluate the completeness of feasibility studies
of their projects.
S. 1047. The Department last testified before the
subcommittee on legislation related to the Leadville Mine
Drainage Tunnel in June 2010, and prior to that in April 2008.
Since the last Congress, the sponsor has continued to refine
the specific language of this bill and incorporate references
to new information from the EPA and the Colorado Department of
Public Health and Environment regarding the new management
actions at the Superfund site.
S. 1047 is consistent with the Department's ongoing
commitment to ensure that the Leadville Mine Drainage Tunnel
poses no threat to public safety and the environment. The
Department supports the revisions made to the bill to date, and
looks forward to working with the committee on further
refinements to clarify remaining concerns as described in my
written testimony.
Two left.
S. 1224. Turning to S. 1224, the Bureau of Reclamation Fish
Recovery Program Reauthorization Act of 2011. The Department
strongly supports the Upper Colorado River Endangered Fish
Recovery Program and the San Juan River Recovery Implementation
Program and twice testified before the 111th Congress in
support of similar legislation. However, we do not support the
language of S. 1224 as introduced.
The Upper Colorado River Endangered Fish Recovery Program
and the San Juan River Recovery Program shall share the dual
goal of recovering populations of endangered fish while water
development continues to meet current and future human needs.
Public Law 106-392 expressly authorized and capped the use of
$6 million per year of Colorado River Storage Project
hydropower revenues from Glen Canyon Dam and other Colorado
River Storage Project facilities to support the base funding
needs of the program through 2011.
The bill as introduced could be interpreted to place the
burden on annual appropriations requested by Reclamation. These
programs have been nationally recognized for their cooperative
approach to recovering aquatic native fish species, avoiding
litigation, and providing Endangered Species Act compliance to
Federal and non-Federal water users. Should the annual
appropriations not materialize, Endangered Species Act
compliance for 2,100 water projects and more than 3 million
acre feet of depletion will be in jeopardy.
Finally, 1225. S. 1225 would authorize the Secretary of the
Interior to convey title to all of the work of the Fort Sumner
Project to the Fort Sumner Irrigation District. Although the
Department supports the potential transfer of the facility in
the future, we cannot support this legislation as it is written
today due to many unresolved issues.
Reclamation and Fort Sumner Irrigation District are in the
midst of a collaborative process to ensure that we identify and
address all the operational, fiscal, environmental and other
issues that arise. We need to resolve these issues before the
Department can support S. 1225.
Additionally, because Reclamation has not yet had the
opportunity to complete a public process, we cannot say that S.
1225 would have either a negative or a positive impact on
stakeholders.
We are committed to continuing to work with the District
and the committee to reach an agreement that will satisfy the
needs of both the United States and the District.
This concludes my statement. On a personal note, as you
know, I'm relatively new at Reclamation, so I'll do my best to
answer all the questions the subcommittee may have, but I may
need to get back to you in writing, and I appreciate your time.
I'm happy to answer all your questions. Thanks.
[The prepared statement of Mr. Payne follows:]
Prepared Statement of Grayford F. Payne, Deputy Commissioner for
Policy, Administration and Budget, Bureau of Reclamation, Department of
the Interior
on s. 1224
Madam Chairman and members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am here today to provide the
views of the Department of the Interior (Department) on S. 1224: the
``Bureau of Reclamation Fish Recovery Programs Reauthorization Act of
2011.'' The Department strongly supports the Upper Colorado River
Endangered Fish Recovery Program and San Juan River Recovery
Implementation Program and twice testified before the 111th Congress in
support of legislation related to S.1224. However, the Department does
not support the language of S. 1224 as introduced. We would like to
work with the Congress to find a mutually acceptable funding mechanism
for this program.
The Upper Colorado River Endangered Fish Recovery Program and San
Juan River Basin Recovery Implementation Program (Programs) share the
dual goals of recovering populations of endangered fish while water
development continues to meet current and future human needs. Program
actions provide Endangered Species Act compliance for more than 2,100
federal, tribal, and non-federal water projects depleting more than 3.7
million acre-feet of water per year in the Colorado and San Juan rivers
and their tributaries. The Programs, authorized by Public Law 106-392,
as amended, were established under cooperative agreements in 1988
(Upper Colorado) and 1992 (San Juan). Program partners include the
states of Colorado, New Mexico, Utah, and Wyoming; the Bureau of
Reclamation, Western Area Power Administration, U.S. Fish and Wildlife
Service, Bureau of Land Management, National Park Service, and Bureau
of Indian Affairs; Native American tribes; environmental organizations;
water users; and power customers.
Public Law 106-392 expressly authorized and capped the use of $6
million per year (indexed for inflation) of Colorado River Storage
Project (CRSP) hydropower revenues from Glen Canyon Dam and other CRSP
facilities to support the base funding needs of the Programs through
2011. Base funding is used for program management, scientific research,
fish population monitoring, fish stocking, control of non-native fish,
and operation and maintenance of capital projects. The bill, as
introduced, could be interpreted to place the burden of providing
annual base funding for anything other than operation and maintenance
of capital projects and monitoring on annual appropriations requested
by Reclamation. Given Reclamation's extensive water supply,
conservation, and mitigation activities, this program would have to
compete with other Reclamation priorities for funding.
These Programs have been nationally recognized for their
cooperative approach to recovering aquatic native fish species,
avoiding litigation, and providing Endangered Species Act compliance to
federal and non-federal water users. Should the annual appropriations
not materialize, Endangered Species Act compliance for 2,100 water
projects and more than 3 million acre-feet of depletions will be in
jeopardy.
______
on s. 500
Madam Chairman and Members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to provide the views
of the Department of the Interior (Department) regarding S. 500,
legislation authorizing the transfer of the Federal portion of the
Strawberry Valley Project Electric Distribution System to the South
Utah Valley Electric Service District (District). Reclamation supports
the title transfer contemplated by this bill and recommends revisions
be made to the bill, which I describe below.
The Strawberry Valley Project (Project) is one of Reclamation's
earliest projects, and all Federal obligations associated with the
Project are fully repaid. Reclamation developed hydropower generation
from the beginning because electricity was required to build the
Project. Early in the Project's history, Reclamation transferred the
operation and maintenance of most of the Project, including the Power
System, to the Strawberry Water Users Association (Association).
The Strawberry Valley Project Power System has three parts: the
powerplants are the Generation System, the high-voltage lines running
from the powerplants to the substations are the Transmission System,
and the low-voltage lines running from the substations to the customers
are the Distribution System.
In 1986, the Association spun off the District--creating an
independent service district with the capability to operate and
maintain the Transmission and Distribution Systems. At the same time,
the Association proposed selling the Distribution System to the
District. Reclamation approved the proposed sale on the condition that
the Association not transfer any Federal facilities. At the time,
Reclamation required that the sale be limited to those portions of the
Distribution System owned by the Association--those parts that were not
completed as part of the original Strawberry Valley Project;
constructed with Strawberry Valley Project revenues; and constructed on
Federal lands or interests in lands. The District paid approximately
$2.7 million for the non-Federal portions of the Distribution System.
Reclamation approved the sale.
In 1986, Reclamation, the Association, and the District believed
that most of the Distribution System was non-Federal. Later, it was
determined that this was not accurate.
The 1940 Repayment Contract between the United States and the
Association states clearly that all additions to the Power System are
Federal facilities; little or none of the Distribution System was owned
by the Association. The District is chagrined at having paid the
Association for facilities it did not receive. The purpose of this Act
is to convey to the District what all parties believed the District
acquired in 1986.
The Act would likely have little effect on operation of the
Strawberry Valley Project. The District would receive fee interest in
those Federal lands on which the Distribution System is the only
Federal feature. On Federal lands sharing both Distribution System and
other Strawberry Valley Project facilities, the legislation grants the
District an easement for access to perform maintenance on the
Distribution System fixtures. This provision preserves the interest of
the United States and the public in the other Strawberry Valley Project
facilities. As for the rest of the Project, the organizations would
remain responsible for operating and maintaining the Generation System
and the Transmission System on behalf of the United States.
Because the Strawberry Valley Project is a paid-out Reclamation
project, there is no outstanding repayment obligation associated with
it. For this reason, the Act does not require any payment from the
District in exchange for title to the Distribution facilities. In
addition, the Act eliminates Reclamation's obligations to oversee the
maintenance of the Distribution System and to administer the associated
lands. The result may be a slight reduction in Reclamation
expenditures.
The change in ownership under the bill will be relatively invisible
to the public. Because the District has been operating and maintaining
the Distribution System for several years, the public will witness a
change in ownership but should not experience any change in operation.
The Act will eliminate uncertainty about ownership and obligations
associated with the Distribution System--which will likely lead to more
efficient and effective operation of the Distribution System.
The Department recognizes that there are benefits to be achieved by
the proposed title transfer and has worked closely and cooperatively
with the interested parties. Before the Department can support S. 500,
we recommend two revisions: First, Section 3(a), directing that ``the
Secretary . . . shall convey and assign'' the facilities to be
transferred, should be changed to ``the Secretary . . . is authorized
to convey and assign'', thereby allowing for completion of the
necessary public input and scoping pursuant to the National
Environmental Policy Act (NEPA). And second, language should be added
to state that the District shall hold the United States harmless for
any claim arising from the 1986 sale of the Distribution System and
from actions under this legislation.
In recent days, we have had discussions with the District about
accelerating the NEPA process and making modifications to the
legislation to address the concerns described in this testimony. As
such, I am confident that we can work with the District, Senator Hatch,
Representative Chaffetz, and the Subcommittee to reach our goal of
supporting this legislation and transferring title to these facilities
in a timely manner.
on s. 802
Madam Chairman and members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to present the views
of the Department of the Interior (Department) on S. 802, a bill to
authorize the Secretary of the Interior to allow the storage and
conveyance of non-project water at the Norman Project in Oklahoma. For
reasons I will discuss below, the Department supports this bill.
Lake Thunderbird, located on the Little River in central Oklahoma,
was constructed as part of the Norman Project for municipal and
industrial water supply, flood control, recreation, and fish & wildlife
purposes. The Central Oklahoma Master Conservancy District (District)
operates the Norman Project under contract with the United States. The
District holds all Project water rights and currently provides water to
the member cities of Norman, Del City and Midwest City.
The Lake Thunderbird watershed experienced a major drought between
2005 and 2006 which resulted in unprecedented low lake levels. Shortly
thereafter, the District and Reclamation jointly determined that the
stored water supply in the lake would require augmentation in the
future to meet demands of the member cities during potential
reoccurring drought periods.
S. 802 would facilitate a proposal by the District to purchase raw
water from the City of Oklahoma City in times of drought and store it
in Lake Thunderbird to augment the yield of the reservoir. The water
would come from Atoka Reservoir in southeast Oklahoma, which is owned
and operated by Oklahoma City. Oklahoma City conveys this water
approximately 100 miles through the existing Atoka pipeline which
crosses the Lake Thunderbird watershed just upstream of the reservoir.
The District and Oklahoma City would tap the Atoka pipeline and
construct a short pipeline to Lake Thunderbird. Because the purchased
water does not originate within the Lake Thunderbird watershed,
Reclamation does not have authority to approve this action. If S. 802
were enacted, Reclamation could approve a water service contract and
provide the means for the action to move forward.
The Department supports this legislation because: (1) Reclamation
has confirmed an immediate and critical water need exists; (2) studies
conducted in 2010 indicate that Lake Thunderbird can be used to store
up to 4,600 acre feet of non-project water, if and when space is
available, with no adverse impacts to operations, the environment,
recreation, and the local economy; (3) the action would be carried out
solely by the District at no cost to the Federal government; and (4)
based on a well attended public meeting in 2009 and on comments
received on the environmental compliance document, the proposed action
is generally supported by interested parties and no known opposition
exists.
on s. 1047
Madam Chairman and Members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to provide the views
of the Department of the Interior (Department) on S. 1047, the
Leadville Mine Drainage Tunnel Act of 2011.
The Department last testified before the Subcommittee on
legislation related to the Leadville Mine Drainage Tunnel (LMDT) in
June of 2010, and prior to that, in April of 2008. Since the last
Congress, the sponsor has continued to refine the specific language of
this bill, and incorporated reference to new information from the U.S.
Environmental Protection Agency (EPA) and the Colorado Department of
Public Health and Environment (CDPHE) regarding new management actions
at the California Gulch National Priority List (Superfund) Site, which
overlies the LMDT. S. 1047 is consistent with the Department's ongoing
commitment to ensure that the LMDT poses no threat to public safety and
the environment. The Department supports the revisions made to the bill
to date and looks forward to working with the Committee on further
refinements to clarify remaining concerns.
The bill has been substantially improved to address the concerns
raised by the Department related to reimbursement and liability. In our
previous testimony, the Department was particularly concerned that the
bill could have been understood to create a liability for Reclamation
where none currently exists. S. 1047 ameliorates these concerns by
appropriately identifying ongoing responsibilities of the Secretary of
the Interior. S. 1047 contains new language not found in previously
introduced versions of the Leadville Mine Drainage Tunnel Act.\1\ In
particular, Section 3 of S. 1047 acknowledges the multi-agency nature
of efforts underway at Leadville, and authorizes the Department to
enter into agreements with other entities for reimbursement in the
event of improvements or expansion of the treatment plant in Leadville.
The bill language authorizes an agreement to cover costs for ``any
necessary capital improvement'' as well as costs associated with
``flows that are conveyed to the treatment plant,'' including surface
water. We note that the Department interprets section 3 to affirm
existing discretionary authority to improve or expand the treatment
plant as well as to allow the Secretary to enter into reimbursement
agreements with other entities with respect to the treatment plant.
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\1\ The Committee-reported version of S. 3404 during the 111th
Congress was amended to include reimbursement language that is similar
to the language found in this session's S. 1047; however, the
reimbursement language was not part of S. 3404 at the time Reclamation
testified on the bill on June 9, 2010.
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We continue to assert that the language in Section 2 of the bill,
which calls on the Secretary of the Interior to ``take any action
necessary to maintain the structural integrity of the [LMDT],'' does
not take into consideration Reclamation's 2008 Risk Assessment on the
LMDT. The Assessment's purpose was to evaluate the stability and assess
the risk associated with the LMDT. The Risk Assessment utilized a
similar process to the one Reclamation uses to assess risk at its dams,
a model that is an international standard for conducting risk
assessments. The Risk Assessment's independent peer review confirmed
that it is highly unlikely that a sudden release of water could occur
from either a blockage in the LMDT, or through the bulkheads installed
in the tunnel. Moreover, the Risk Assessment concluded that even if an
existing natural blockage in the upper part of the LMDT failed rapidly,
a sudden release of water through the lower blockage and bulkheads is
unlikely. In 2008, Reclamation also worked cooperatively with the EPA
and CDPHE to install additional drainage capability into the LMDT. We
have also held several public meetings with residents living in the
Village at East Fork and others in the Leadville area to convey
Reclamation's findings that the LMDT is safe, and have continued an
active dialogue with the EPA during the agency's revision of the
proposed remedy for Operable Unit 6 (OU6) of the California Gulch
National Priority List (Superfund) Site, which lies above the LMDT. We
agree with the remedy selected in EPA's amended Record of Decision,
published in 2010, which would implement actions to avoid diversion of
water into the LMDT. Recent studies conducted by EPA conclude that
using the mine workings and the LMDT to convey water cannot be relied
on for the long term, and that it is neither cost effective nor
efficient to treat diluted acid rock drainage this way in perpetuity.
We have also had very productive interactions with Senator Mark Udall's
office and the Subcommittee on this legislation, and we appreciate
those discussions.
We recognize the desire of Congress to assure the residents of
Leadville and the Village at East Fork that Reclamation will continue
to manage its facilities appropriately, and be accountable. This
legislation essentially codifies these ongoing actions for the long
term.
on s. 1225
Madam Chairman and members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to provide the views
of the Department of the Interior (Department) regarding S. 1225, which
would authorize the Secretary of the Interior to convey title to all of
the works of the Fort Sumner Project (including the diversion dam,
easements, ditches, laterals, canals, drains, and other rights) to the
Fort Sumner Irrigation District (FSID).
Reclamation was able to work from draft versions of this bill to
formulate testimony in the days leading up to this hearing. Because the
language has only recently been finalized for introduction this past
week as S. 1225, this statement will speak to the major provisions,
while some of the bill's language is still being analyzed. At this
time, the Department believes consideration or enactment of S. 1225 is
premature.
The FSID has been a good partner in assisting Reclamation with
difficult Endangered Species Act (ESA) issues on the Pecos River.
Although the Department supports the potential transfer of this
facility in the future, it cannot presently support this legislation as
it is written due to many unresolved issues involved in such a
transfer, as described below. Reclamation and the FSID are in the midst
of a collaborative process to ensure that we identify and address all
of the operational, fiscal, environmental, and other issues that arise.
However, at this time, that process is not complete and thus title
transfer of these facilities should not move forward until completion
of that process.
Title Transfer Process
Over the past ten plus years, the Bureau of Reclamation has had an
opportunity to work on a number of title transfer proposals. It has
been our experience that the more on-the-ground coordination and work
we accomplish before the legislative process, and the more issues that
we can resolve in advance, the faster the legislative process will go
and as importantly, the faster we can successfully implement the
legislation to get the lands and facilities transferred. While some
have thought that moving to the legislative phase quickly would speed
up the process, it has been our experience that we are more effective
when we scope out, identify, and reach agreement on all issues prior to
initiating the legislative process.
In this case, while we have taken some steps toward that
collaborative process, we have several steps to go and it is our hope
that Reclamation, together with the FSID and other stakeholders (such
as the State of New Mexico and potentially other water users in the
Pecos River system) can work through that process.
Currently, there are two Reclamation projects on the Pecos River:
the Carlsbad and Fort Sumner Projects. The Fort Sumner Project was
developed by private interests at the turn of the last century. It was
reconstructed and rehabilitated by Reclamation in the 1950s.
Reclamation and the FSID executed a contract in 1948 to provide for the
repayment of construction costs to rehabilitate the project. The FSID
has an annual repayment obligation of about $54,500 with an outstanding
balance of approximately $652,000.
The FSID holds a senior water right for not more than 100 cubic
feet per second from the natural flow of the Pecos River. Reclamation
must bypass the FSID's water through Sumner Reservoir prior to storing
water for the Carlsbad Project. Over the past ten years, Reclamation
has consulted with the U.S. Fish and Wildlife Service (Service) to
ensure that Federal actions are not jeopardizing the existence of the
Pecos bluntnose shiner or adversely modifying its critical habitat
located below FSID's diversion dam. In these consultations, Reclamation
has committed to the Service to keep the Pecos River from becoming
intermittent. A significant cause of drying on the Pecos is due to the
FSID diverting its senior water right. The only way Reclamation has
been able to keep the Pecos River flowing is by purchasing water from
willing sellers and by paying the FSID not to divert water through a
forbearance agreement.
In August 2009, Reclamation and FSID entered into a mutually
beneficial agreement whereby FSID would forbear the diversion of up to
2,500 acre-feet of water annually for ten years when they would
otherwise be in priority. Instead, this water goes into Sumner Lake
reservoir where it is stored and delivered for Reclamation to prevent
intermittency of flows on the Pecos River in compliance with the 2006
biological opinion. Reclamation pays FSID $60,000 annually plus $20 per
acre-foot for the water. In addition to the forbearance of this water,
FSID agreed to pursue ESA Section 10 consultation with the Service and
Reclamation agreed to assist them in this process. Also in this
agreement, FSID indicated their desire to take title to the facilities
and Reclamation agreed to work with them on that process. The
forbearance agreement further provides that the annual payments of
$60,000 from Reclamation to FSID will cease upon passage of title
transfer legislation. To date, this has been a mutually beneficial
agreement. The forbearance water has afforded Reclamation with an
additional tool to meet the biological opinion to ensure that the Pecos
River does not run dry.
Therefore, initiating title transfer and the completion of the
Section 10 process with the Service are closely interconnected
processes. It is the Department's view that we cannot complete the
title transfer without completing the Section 10 process.
As currently drafted, S. 1225 makes limited reference to the
scoring or valuation issues that are important issues in title
transfers. Section 5 requires the forgiveness of FSID's repayment
obligation to the United States that was agreed upon by contract when
the construction and rehabilitation of the facilities were undertaken.
Consequently, as currently crafted, this would result in a financial
loss to the U.S. Treasury. We note that this would trigger the need for
consideration of fiscal impacts under the Statutory Pay-As-You-Go Act
of 2010.
While Reclamation and the FSID have had some initial discussions
about how to address this issue in an equitable manner, there has been
no resolution and a significant amount of work needs to be done on this
issue. One of the key unresolved issues is the terms of the ESA Section
10 agreement to be developed between FSID and the U.S. Fish and
Wildlife Service. This agreement will have a bearing on the valuation,
whether we would need to have a forbearance agreement after the title
transfer, and whether we would need to buy water to meet the current
ESA obligations on the Pecos River.
Because Reclamation has not yet had the opportunity to complete a
public process to determine whether other interested citizens of New
Mexico have concerns or interests in the proposal, we cannot with any
certainty say that the title transfer proposed by S. 1225 would have
either negative or positive impacts on other stakeholders. As part of
the National Environmental Policy Act process, Reclamation would
typically undertake a public scoping or outreach process to solicit the
views of the public. It is our hope that we will have the opportunity
to complete that process before the legislation is enacted so that
Reclamation and FSID can collaboratively address any concerns up front
or in the terms and conditions of the title transfer.
Before agreeing to title transfer, the FSID and the Service need to
enter into a habitat conservation plan under Section 10 of the ESA.
Reclamation can assist in this process and facilitate a plan and an
agreement between the FSID and Service; but after completing Section 10
compliance, Reclamation will need to re-consult with the Service on its
continued operations on the Pecos. This and other environmental
compliance measures need to be completed before finalizing title
transfer.
Lastly, Reclamation is unsure of the intent behind the language in
Section 7 which references ``future benefits from the Reclamation
Fund.'' We are interested in discussing this language further with the
Subcommittee.
Currently, while the Department views the Fort Sumner Project as a
goodcandidate for title transfer, legislation should await completion
of the crucial and interconnected steps summarized above. To make
determinations of the fiscal impact to the United States, the benefit
to the public, and the responsibilities for environmental compliance,
FSID and the Service, with Reclamation's support, need to complete the
process outlined in Section 10 of the ESA before title transfer occurs.
Once we complete that process, we will have a better understanding of
the necessary and appropriate terms and conditions associated with this
title transfer. However, at this time, the Department believes this
legislation is premature and would raise concerns about impacts on the
U.S. Treasury as discussed above.
on s. 997
Madam Chairman and Members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to provide the views
of the Department of the Interior (Department) on S.997, the East Bench
Irrigation District Water Contract Extension Act. The Department
supports S. 997.
Reclamation's Clark Canyon Dam and Reservoir are located in
southwest Montana and supply irrigation water under contract to the
East Bench Irrigation District (EBID). EBID's water service contract
with Reclamation was first executed in October 1958 and expired on
December 31, 2005. Pursuant to Section 1 of the Act of May 15, 1922 (42
Stat. 541), Section 46 of the Omnibus Adjustment Act of 1926 (44 Stat.
649), and Section 85-7-1957, Montana Code Annotated, execution of a new
contract between the United States and any irrigation district requires
a Montana 5th District Court decree.
In 2006, EBID filed a petition with the court seeking court
confirmation of the execution of their new proposed renewed contract
with Reclamation. A hearing was convened on December 14, 2006, in
Dillon, MT. One party appeared and filed an objection to the
confirmation proceedings. The parties involved in this court
confirmation case have filed various petitions and motions with the
court. The court issued an order on April 26, 2007, in response to
EBID's petition to dismiss the objection, dismissing some of the
counterclaims filed by the objectors, but continuing with other
counterclaims. No trial date has been set for this case and as a
result, no court decree confirming the 2006 contract has been issued.
Additionally, prior year appropriations bills have extended the
contracts for terms of up to two years. EBID remains concerned about
losing their right to renew their 1958 contract if it is allowed to
expire prior to securing a court decree of the renewed 2006 Contract.
For this reason they are pursuing extension of the 1958 contract versus
relying on a temporary water service contract.
Under current law, the 2006 contract is not binding on the United
States until court confirmation is secured. A final decree from the
court confirming the 2006 contract has not occurred. Therefore, EBID is
seeking authority under S. 997 to extend the 1958 contract. S. 997
would extend the contract for four years (to December 31, 2013) or
until a new contract is executed, and still defer to the court to take
up the issue again at a time of its choosing. The Department supports
this legislation because it would allow water service to the EBID to
continue and protects the right for contract renewal while the court
confirmation process is given time to be completed.
on s. 1033
Madam Chairman and Members of the Subcommittee, I am Grayford
Payne, Deputy Commissioner for Policy, Administration and Budget at the
Bureau of Reclamation (Reclamation). I am pleased to provide the views
of the Department of the Interior (Department) on S. 1033, the City of
Hermiston, Oregon, Water Recycling and Reuse Project. For reasons I
will discuss below, the Department cannot support the bill.
S. 1033 would amend the Reclamation Wastewater and Groundwater
Study and Facilities Act (Public Law 102-575, 43 U.S.C. 390h et seq.),
commonly called Title XVI, to authorize the Secretary of the Interior
to participate in the design, planning, and construction of permanent
facilities needed to reclaim and reuse water in the City of Hermiston,
Oregon. The project is being implemented by the City of Hermiston.
The City of Hermiston (City), located in north central Oregon, is
one of the largest communities within Reclamation's Umatilla Project
area. The project proposed by the City includes upgrades and
construction at their existing wastewater treatment facility and
construction of a delivery system that would deliver recycled water to
the West Extension Irrigation District. This recycled water would be
used by the District to irrigate agricultural lands. By 2031, it is
estimated that this proposed project would provide the District with an
approximate 2,034 acre-feet of drought resistant water supply during
the irrigation season. The current total estimated cost for this
project is approximately $25.8 million.
In January 2010, the City of Hermiston submitted their feasibility
report to Reclamation for review under the Title XVI program. In April
2010, Reclamation's review team completed the review and made the
certification that the proposed project ``Meets Requirements'' as
defined under section 1604 of Public Law 102-575, as amended.
The City and Reclamation's Pacific Northwest Region are continuing
to coordinate on actions that are necessary to be complete prior to
implementation of the proposed project. This includes activities such
as finalization of the determination of the project sponsor's financial
capability, entering into a land use agreement since the delivery pipe
is to cross Reclamation land, and entering into a permit to accept the
delivery of this water into the canal.
S. 1033 would authorize the City of Hermiston's project under Title
XVI for Federal funding not to exceed 25 percent of the total cost of
the project.
While the Department supports efforts to increase local water
supplies and increase recycled water use, this project would compete
for funds with other needs within the Reclamation program, including
other Title XVI projects currently under construction. In general, the
Department supports the Title XVI Reclamation and Reuse program. The
2012 budget request includes funding for the Department's WaterSMART
Program, of which Title XVI is an important element. Specifically, the
2012 budget request includes $29 million for the Title XVI program.
This represents a significant increase over funding levels for the
program in recent years.
As part of this total, the Department is requesting $23.4 million
to fund Title XVI projects selected through a competitive funding
opportunity process which uses criteria finalized in 2010 to identify
activities most closely aligned with Title XVI statutory and program
goals. Reclamation plans to invite sponsors of Congressionally
authorized Title XVI projects to submit applications for funding under
the program and will review and rank proposals against those criteria
to identify projects for funding, subject to appropriations in fiscal
year 2012. A similar procedure was used this year to identify projects
for 2011 funding, which were announced last month. The remaining $5.6
million of the Title XVI request is to continue funding projects
currently underway and for program administration.
We recognize that water reuse is an essential tool in stretching
the limited water supplies in the West, and I believe the FY 2012
budget request on top of $140 million in American Recovery and
Reinvestment Act funding for Title XVI has demonstrated the emphasis
placed by this Administration on this Program. However, given that
there are 53 already authorized Title XVI projects and numerous
competing mission priorities and demands on Reclamation's budget, the
Department cannot support the authorization of new Title XVI projects
or extensions of existing authorized cost ceilings. Reclamation will,
however, continue to work with project proponents to evaluate the
completeness of feasibility studies of their projects.
Madam Chairman, this concludes my written statement.
Senator Shaheen. Thank you very much, Mr. Payne.
Before we go to questions, I'm going to ask if our other 2
witnesses would also testify.
So, Mr. Katz, would you like to go ahead?
STATEMENT OF JOHN KATZ, DEPUTY ASSOCIATE GENERAL COUNSEL,
FEDERAL ENERGY REGULATORY COMMISSION
Mr. Katz. Thank you, Chair Shaheen, Ranking Member Lee. As
Chair Shaheen noted, I am representing the Federal Energy
Regulatory Commission, but as a member of the Commission staff,
my views are my own and do not necessarily represent those of
the Commission or any individual commissioner.
As Senator Blumenthal summarized, S. 715 involves an
instance of a project that was licensed by the Commission to a
private developer, the license for which was subsequently
terminated by the Commission as required by the Federal Power
Act because the developer did not commence construction of the
project within the times authorized by the Commission, which
were the maximum timeframes allowed by the Federal Power Act.
S. 715 would allow but not require the Commission to
reinstate the license for these projects following preparation
of an environmental assessment and the provision of a period
for public notice and comment; and if the Commission so chose
to reinstate the project licenses, would require the Commission
to transfer those licenses to the city of Canton.
As I explained in my testimony, Chairman Wellinghoff and
the past several chairmen of the Commission have had a policy
of not opposing reinstatement bills where the total timeframe
for the commencement of construction was no longer than 10
years from when the project was originally licensed.
The reason for this policy essentially is to avoid site
banking, that is where an individual developer retains but does
not develop a site for an unduly lengthy period of time; to
avoid staleness of the environmental record; and to avoid the
impacts on competition that might be felt if a site was not
available to be competed for by any entity that might be
interested.
In the case of this bill, site banking is not an issue
because the original entity that held the licenses, the Summit
Hydro Development Corporation, is no longer involved. The
project, if transferred, would be transferred to the city of
Canton, which is a different entity. So site banking is not a
concern here.
With regard to the environmental impacts, the bill
specifically mandates that if the Commission reinstates the
license, it must do an environmental analysis to determine
whether there have been any changed environmental impacts, and
further provides that the Commission may impose any conditions
necessary to deal with such impacts.
With respect to impacts on competition during the time
since the license has been terminated, the Commission is aware
of no other entity than the Town of Canton that has expressed
any interest in developing this project. Therefore, that does
not particularly appear to be an issue here.
In light of the foregoing, I make a slight exception to my
statement about not representing the Commission or any
commissioners in that Chairman Wellinghoff has authorized me to
say that because of the factors I've analyzed, he does not
oppose the proposed legislation. Thank you.
[The prepared statement of Mr. Katz follows:]
Prepared Statement of John Katz, Deputy Associate General Counsel,
Federal Energy Regulatory Commission,
on s. 715
Chair Shaheen, Ranking Member Lee, and Members of the Subcommittee
My name is John Katz, Deputy Associate General Counsel for Energy
Projects, Federal Energy Regulatory Commission. I appreciate the
opportunity to appear before you to discuss S. 715. As a member of the
Commission's staff, the views I express in this testimony are my own,
and not those of the Chairman (other than as specifically noted below)
or of any individual Commissioner.
I. Background
On February 23, 2001, the Commission issued original licenses to
Summit Hydropower for the 373 kilowatt (kW) Upper and the 920 kW Lower
Collinsville Hydro Projects, to be located at the Upper and Lower
Collinsville Dams on the Farmington River, in Hartford County,
Connecticut.
Section 13 of the Federal Power Act requires that licensees
commence project Construction by the deadline established in the
license, which may be no longer than two years from the date of license
issuance. The Commission may extend the deadline once, for no longer
than two additional years. If construction does not timely commence,
section 13 requires the Commission to terminate the license by written
order.
Consistent with section 13, Article 301 of the licenses for the
Collinsville Upper and Lower Hydroelectric Projects required the
licensee to commence project construction within two years. On November
26, 2002, at the licensee's request, the Commission issued the maximum
allowable two-year extension, moving the commencement of construction
deadline to February 23, 2005.
Summit did not commence project construction by the deadline.
Accordingly, by letter dated November 2, 2007, the Commission gave
Summit notice of probable termination of the licenses. Summit did not
reply to the notice. By order issued December 4, 2007, the Commission
terminated the project licensees. The licensee did not seek rehearing
of the termination order, which therefore became final on January 3,
2008.
II. S.715
S.715 would authorize the Commission to reinstate either or both of
the licenses for the Upper and Lower Collinsville Projects and to
extend for two years the commencement of construction deadline for the
projects. Should the Commission reinstate either or both licensees, the
bill requires the Commission to transfer the license or licensees to
the town of Canton, Connecticut. These actions are to be taken within
270 days of the date of enactment of the bill.
In addition, S.715 requires the Commission to complete, within 180
days of the date of enactment of the bill, an environmental assessment
of the projects, updating, to the extent necessary, the analysis
performed in the previous licensing proceeding. The Commission is to
provide for a 30-day public comment period, consider any comments that
are received, and, based on the environmental assessment and the
comments, incorporate in the project license or licensees such terms
and condition as the Commission deems necessary. Chairman Wellinghoff
and the last several Commission Chairmen have taken the position of not
opposing legislation that would extend the commencement of construction
deadline no further than 10 years from the date that the license in
question was issued. Where proposed extensions would run beyond that
time, there has been a sense that the public interest is better served
by releasing the site for other public uses.
In this instance, the proposed extensions would run at least two
years beyond 10 years from when the licenses for the Upper and Lower
Collinsville Projects were issued. However, to Commission staff's
knowledge, in the three and one-half years since the project licenses
were terminated, no entity has sought to develop the projects or
proposed other uses for the project sites. Moreover, because S.715
specifically provides for the preparation of an updated analysis,
staleness of the environmental record, which can be of concern in cases
of this type, will not be an issue. In consequence, I am authorized to
state that Chairman Wellinghoff does not oppose S.715. Also, I
anticipate that the Commission staff should be able to meet the
deadlines established by S.715, assuming that the town of Canton is
able to timely supply any information staff needs and that a need does
not arise to engage in consultation under the Endangered Species Act,
or to deal with other, similar matters, the timing of which is not in
the Commission's control.
I would be pleased to answer any questions you may have.
Senator Shaheen. Thank you, Mr. Katz.
Mr. Barlow.
STATEMENT OF RICHARD J. BARLOW, FIRST SELECTMAN, TOWN OF
CANTON, CANTON, COLLINSVILLE, CT
Mr. Barlow. Good afternoon, Chairwoman Shaheen, Ranking
Member Lee. My name is Richard J. Barlow, and I'm the First
Selectman of the Town of Canton, Connecticut. We're not a city.
We're a small town, 10,125 residents, located on the Farmington
River in the northwest portion of the State of Connecticut.
I appreciate the opportunity to appear before you to
support S. 715, the Collinsville Renewable Energy Promotion
Act. The Town would like to acknowledge the co-sponsors of this
bill, Senators Lieberman and Senator Blumenthal, both of which
I had the pleasure of working with extensively when they were
Attorneys General of the State of Connecticut, and both of them
have been great champions for the environment, and they
certainly continue that tradition within the Senate, and I
appreciate that on a personal note.
With the support of Representative Murphy, similar
legislation was passed last session by the House of
Representatives. Currently a companion bill, H.R. 1353, is
before the House of Representatives this session.
The Collinsville Hydro Project would reactivate 2
hydroelectric facilities known as the Upper Collinsville Dam
and the Lower Collinsville Dam, originally constructed by the
Collins Company, one of the Nation's first manufacturers of
axes, machetes, and other cutting tools. The facilities were
constructed in the early 19th Century and served to provide
power for the company operations until the mid-1960s, when,
unfortunately, they went out of business and relocated to
Central America.
In 1965, the Connecticut Power Company, the Connecticut
Light and Power Company acquired the facilities and dams. That
was in the time of cheap nuclear energy, and they didn't want
the competition. They deactivated the facilities. Worse than
that, they scuttled them. Not only did they take the generating
equipment out, but they took cutting torches and cut the 10-
inch solid shafts going down to the turbines just to make
certain that any future use of the facility would be extremely
difficult. Then after deactivating the facilities and removing
the generating equipment, they gifted the dams and their
liabilities to the State of Connecticut.
The Town of Canton, in partnership with the Metropolitan
District Commission, a Hartford-area drinking water and sewer
authority, attempted to reactive the dams in the 1980s. While
that attempt failed, the data they developed in part served as
the basis for an application by a private company which
successfully obtained a FERC license in 2001. My written
testimony did say 2003. I'd like to point out it was 2001.
Unable to reach agreement on a lease for the dams and possible
other reasons, the licensee failed to start construction. In
December 2007, after a notice of revocation, FERC did, in fact,
revoke the licenses for the project.
At that time, the Town of Canton began to consider
reactivating the facilities. That action resulted in the Town
filing for a preliminary FERC license on August 6, 2008. The
Lower Dam is actually in the towns of Avon and Burlington, and
the Town of Canton has solicited their participation to develop
and operate that portion of the project. FERC issued by order a
preliminary license to the Town of Canton on January 8th, 2009.
Understanding that Congress has in the past reinstated and
transferred licenses to other parties, the Town began working
with our Congressional delegation to seek the reissuance of the
final license to the Town of Canton. After extensive
consultation with stakeholders, including local environmental
groups and the State Department of Environmental Protection,
Representative Murphy and Senator Dodd submitted bills to
accomplish that task. Unfortunately, the Senate did not approve
the bill in the last session.
Since that time, the Town has established an advisory
committee, and we're well on our way toward working on ways to
develop the project which we feel is an important part of the
culture and heritage of a small New England community. It's a
way to improve the environment by providing fish passage at the
dams which the State does not have the resources to do, and
also a way to provide a source of clean green energy which will
reduce our dependence on energy sources.
We clearly understand that generating less than 2 megawatts
will not answer our energy needs, but we feel that the Town
will be meeting the majority of its needs, and we think that
that's an important thing to do. We've done a number of other
activities over the last several years to secure licenses. We
just recently passed in the State of Connecticut a virtual
metering bill which will also aid in the economics of the
project.
I appreciate your support for this and would be happy to
try to answer any questions you may have.
[The prepared statement of Mr. Barlow follows:]
Prepared Statement of Richard J. Barlow, First Selectman, Town of
Canton, Collinsville, CT
on s. 715
Chairman Shaheen and Members of the Subcommittee on Water and Power
my name is Richard J. Barlow and I am the First Selectman of the Town
of Canton, as small town of 10,125 residents located on the Farmington
River in northwestern Connecticut. I appreciate the opportunity to
appear before you to support S. 715, a bill to reinstate and transfer
certain hydroelectric licenses and extend the deadline for commencement
of construction of certain hydroelectric projects (the Collinsville
Renewable Energy Promotion Act). The Town would like to acknowledge the
co-sponsors of this bill, Senators Lieberman and Blumenthal. With the
support of Representative Murphy similar legislation was passed last
Session by the House of Representatives. Currently, a companion bill,
HR. 1353 is before the House of Representatives this Session.
The Collinsville Hydro Project will reactivate two hydroelectric
facilities known as the Upper Collinsville Dam and the Lower
Collinsville Dam originally constructed by the Collins Company, one of
the nation's first manufacturers of axes, machetes, and other cutting
tools. The facilities were constructed in the early 19th century and
served to provide power for the Company operations until the mid 1960s
when their operations were relocated to Central America. In 1965 the
Connecticut Light & Power Company acquired the facilities and dams.
They then deactivated the facilities, removed the generating equipment
and gifted the dams to the State of Connecticut.
The Town of Canton in partnership with the Metropolitan District
Commission, a Hartford area drinking water and sewer authority,
attempted to re-activate the dams in the 1980s. While that attempt
failed, the data they developed in part served as the basis for an
application by a private company which successfully obtained a FERC
license in 2003. Unable to obtain an agreement from the State to lease
the dams and possibly for other unknown reasons the licensee failed to
start construction. In January 2008 after issuance of a notice to
revoke the licenses to which the licensee did not respond, FERC did, in
fact, revoke the license for the project.
At that time, the Town of Canton began to consider re-activating
the facilities. That action resulted in the Town filing for a
preliminary FERC license on August 6, 2008. The Lower Collinsville Dam
is actually in the Towns of Avon and Burlington and the Town of Canton
has solicited their participation to develop and operate that portion
of the Project. FERC issued by order a preliminary license to the Town
of Canton on January 8, 2009.
Understanding that Congress has in the past reinstated and
transferred licenses to other parties the Town began to work with our
Congressional delegation to seek the reissuance of the final license to
the Town of Canton. After extensive consultation with stakeholders
including local environmental groups and the State Department of
Environmental Protection Representative Murphy and Senator Dodd
submitted bills to accomplish that task. Unfortunately last Session the
Senate did not take action on the proposed legislation before
adjournment.
Since that time, the Town has established an advisory committee to
define the Project. The Town envisions the Project as a way to re-
establish a part of the culture and heritage of our community, a way to
improve the environment by providing fish passage at the dams and, of
course, an opportunity to provide a source of clean, green energy which
will reduce our dependence on foreign energy sources.
Clearly, at a generating capacity of less than two mega watts, the
Project is not the answer all our nation's energy needs, but it will
provide the Towns with a source to meet the majority of their public
facility needs.
In the past two years, the Town has been successful in obtaining
State legislation requiring the State Commissioner of Environmental
Protection to provide the Towns access to the dams for the purposes of
hydroelectric power generation with the provision that fish passage be
established. The Town has considered fish passage to be an important
component of the project development. Without this project, the State
would not be able to provide the monies to accomplish that task. Local
environmental groups have recognized that the State does not have
monies to accomplish fish passage by construction of fish ladders or
the breeching of the dams.
The Connecticut General Assembly, just this past month, enacted
legislation to allow for municipalities to use virtual net metering for
clean energy projects. This action, which the Town of Canton
championed, greatly increases the potential to make the Project
economically feasible. The State of Connecticut has also recently
established a funding program for clean energy projects which the Town
expects to pursue.
In the last year with $50,000 in funding from the Connecticut Clean
Energy Fund the Town was able to contract with a consultant who
performed a preliminary feasibility study of the Project. With the
ability to use virtual net metering the Project has reached a point
where the Towns may expect a modest return on their investment in the
initial years of operation.
In closing I thank the Subcommittee for the opportunity to testify
before you. I would be happy to try to answer any questions you may
have regarding our Project.
Senator Shaheen. Thank you very much. We have a lot of
small towns in New Hampshire with selectmen, too, so we
appreciate your being here.
Mr. Barlow. The Senator is one up from the Attorney
Generals. I went down. So I don't know what that means, but----
Senator Shaheen. That's OK. We're glad you're here.
I have some questions, most of them for Mr. Payne relative
to the bills, nothing difficult, too difficult anyway, and I'll
just take these pretty much in the order in which your
testimony was given.
On S. 500, which is the South Utah Valley Electric Service
District, I suspect Senator Lee may have some questions or
comments on this one. But your testimony indicates that
Reclamation supports this bill, but that modifications should
be made to some of the language--I think you mentioned 2
places--before we move forward.
Is Reclamation committed to working with the District and
the committee on those changes to the bill? Can you help us
with that?
Mr. Payne. Yes, Reclamation is very committed to working to
get this resolved.
Senator Shaheen. Thank you. On S. 802, the storage of non-
Project water in Lake Thunderbird in Oklahoma, I assume the
Department supports this bill in part because there are no
additional costs to the Federal Government. How will the costs
of the additional storage be computed, and what agreements will
be necessary to ensure that any costs to the Federal Government
are recovered?
Mr. Payne. Right now, the costs associated--right now there
are about 4,600 acre feet of water that the District will
purchase from the Atoka Reservoir up in Oklahoma City. They
will not charge for that additional water but any water above
the 4,600 the region has said that they will get into contract
negotiations with the District to come up with what the charged
cost should be for that water.
Senator Shaheen. So you're comfortable with that?
Mr. Payne. Yes, at this point. Yes, we are.
Senator Shaheen. OK. Reclamation recently received an
appropriation of $121,000 to evaluate the feasibility of
storing additional water at Lake Thunderbird. Can you tell me
if that process has been completed, and are there any remaining
steps that need to be taken to allow the District to move
forward with the storage of additional water?
Mr. Payne. That process actually has been completed, and
the water that was looked at, the water that was to be brought
in, everything was favorable, and they have had a public
scoping with the community, and it's been very favorable there,
too.
Senator Shaheen. So once the scoping is done, what needs to
happen then?
Mr. Payne. I think that, at that point in time, then the
whole process, we just have to get the authorization to be able
to allow us to be able to bring in non-Project water, and then
we're all set, and then they will start the development of a
small--I think it's a thousand-foot pipeline that will be a
feeder off of an existing pipeline that's coming out of Lake
Atoka that actually goes through this watershed, and they'll
just feed off of that pipeline.
Senator Shaheen. OK. Thank you.
S. 997, the East Bench Irrigation District Water Contract
Extension. To your knowledge, is the current delay in moving
forward with approval of the new contract only a result of the
Montana court process, or is it the fault of either the local
water district or the Bureau of Reclamation?
Mr. Payne. It's neither the fault of the Bureau nor of the
water district. This is just a process that the 5th District
Court of Montana has, and my discussions with the region and
the area office is it's just been a backlog.
Senator Shaheen. Great. So would Reclamation be supportive
of a contract extension for longer than 4 years if the court
process ends up extending beyond 2013?
Mr. Payne. I'm not sure. I feel the way we--we feel that we
have talked, and the District--actually, the 5th District Court
is making a very concerted effort to get this backlog completed
within the next 3 years, and the word we're hearing is that
they're on a fast track to get all this done. That's why we
felt that the 4 years would probably be fine, but I can get
back to you with a written statement about your question.
Senator Shaheen. That would be great.
Mr. Payne. Thank you.
Senator Shaheen. S. 1033, city of Hermiston, Oregon Water
Recycling Project. I think Senator Wyden may be coming, but
there are a few questions that I have relative to this
legislation. You indicated that the Department opposes the
legislation. Is the primary objection that you have that Title
16 has been too popular and that you don't have the sufficient
appropriation in order to meet all of the funding requirements
for previously authorized projects?
Mr. Payne. Currently we have 53 authorized projects
already, and so that is one of our issues. We've gone through a
deliberate competitive process to bring these projects on. So
this project, while it's a worthy project, has not gone through
our competitive process, and if it was to be wedged into this
line, it would then compete with projects that have already
gone through a competitive process and the funding was there.
So it--did I answer it?
Senator Shaheen. I have a couple of follow-up questions,
but my time is out.
You want me to go ahead?
Given that, and given obviously the current tight budget
situation that we're in, what advice would you have for project
proponents who have met all the requirements, they have good
water recycling projects to go forward, but they're not going
to be able--under that scenario that you've laid out, they're
not going to be able to get Reclamation support?
Mr. Payne. You know, Senator, I am not that versed in Title
16, and so I'd appreciate if I could just get back to you with
in writing.
Senator Shaheen. Sure. That would be great.
I have another follow-up question that you can get back to
us with a written response, as well, and that is what is the
status of Reclamation's review of Title 16 funding backlog, and
have you determined which authorized projects will not be going
forward and which projects have not yet even met the
feasibility requirements?
Mr. Payne. Yes we will thank you.
Senator Shaheen. So, Senator Lee.
Senator Lee. Thank you for joining us, and thank you,
Senator Shaheen.
Mr. Payne, I've got a couple of questions, one in
particular related to S. 500. The change that you proposed, the
first change that you proposed involves changing the language
that we've got from essentially ``the Secretary shall convey
and assign'' to essentially ``the Secretary is authorized to
convey and assign.'' This is a difference. It does make a
difference. It makes a difference in much the same way that if
my wife said, ``Mike, take out the trash, you shall take out
the trash and do the dishes,'' that means something different
than ``Mike, you may take out the trash and do the dishes.''
Those are 2 different things, aren't they?
So if we change the language in this, it seems to me that
it's less likely to happen unless it's phrased in mandatory
terms. As I understand it, we've had this issue come up a
number of times since I think the early 1990s, and sometimes
the language in the end has followed more or less the model
that you've prescribed, and sometimes it has remained with the
``shall'' language.
Can you tell me, do you have sort of a thumbnail sketch
idea about what the ratio is on how many times we might have
used ``shall'' versus ``is authorized to''?
Mr. Payne. Actually, no, Senator, I don't. I don't have a
thumbnail on that.
Senator Lee. But you're aware that we've used both.
Mr. Payne. I'm assuming we have, right.
Senator Lee. It's my understanding that every time we use
the ``shall'' language, it's a little bit more likely that
whatever we're wanting to have happen actually happens, and
that it happens in a relatively short period of time. Has that
been your experience?
Mr. Payne. My short time here, I can't tell the answer to
that. You know, I've been here 8 months. So I do not have an
answer.
Senator Lee. But to your knowledge, it's not incorrect.
Mr. Payne. It may not be incorrect.
Senator Lee. OK.
Mr. Payne. I do know that we're very committed to having,
to making this transfer happen.
Senator Lee. Right. If you're committed to having it
happen, I assume that it wouldn't be a problem to use the
shall'' language, just like it wouldn't be a problem for me, if
I intended anyway to do the dishes and take out the trash, for
my wife to use the word ``shall.''
I want to make clear, by the way, since she's not here to
defend herself, she rarely uses the language ``shall.''
[Laughter.]
Mr. Payne. For me, it's used a lot at home, with 3
daughters.
[Laughter.]
Senator Lee. Yes, and that's important.
For whatever that's worth, it doesn't seem to me to be a
very good idea, if we want something to happen, to say ``may''
rather than ``shall,'' which is essentially what you're asking
us to do.
OK. Turning to S. 1033, Reclamation has indicated that its
efficiency performance measure goal for the Title 16 program is
to reduce the average annual Federal cost per acre foot for
Title 16 water from about $18,173 per acre foot to about $1,200
per acre foot. But taking into account construction inflation
costs and other limitations, is an increase in efficiency along
this order, is it reasonable? Is it feasible?
Mr. Payne. I'm--based on my discussions with our Title 16
experts, I feel it is. I think that our issue is that we're
early in the phase and we need to get further down the road
with more projects so we can see the return, so we can see
where--because it's very early in this whole phase of whether,
to see those numbers go down.
Senator Lee. OK.
Mr. Payne. That's probably not quite the answer you want,
but I can get back to you with more written testimony about
what their projections are on those numbers.
Senator Lee. That might be helpful, if you could just sort
of let us know what assumptions were or were not built into
that.
Mr. Payne. Absolutely.
Senator Lee. Thank you.
Then on S. 1224, what's the current timetable, or can you
identify a current timetable and outlook for recovery of the
affected species in the Upper Colorado Basin and in the San
Juan Basin?
Mr. Payne. We've been told by our regional people that
should be in 2023 according to estimates.
Senator Lee. OK; 2023? Now, if Congress were to fail, for
whatever reason, to reauthorize this program, what would be the
likely impact on the development rights along the Colorado
River?
Mr. Payne. I know that if you fail to authorize this
program, I don't quite have an answer for that. I'm not quite
sure where you're coming from on that answer.
Senator Lee. Just--OK. I'm trying to assess what would
happen to water rights along the Colorado generally if we were
to do that, if that would cause broader problems, but we can
probably talk about that offline at some point.
I think that pretty well covers what I need to go over with
you. Yes. Thank you very much.
Mr. Payne. Thank you.
Senator Shaheen. Thank you, Senator Lee.
I will go back and actually follow up a little bit also on
the fish recovery programs reauthorization act. Am I correct in
assuming that the only reason Reclamation doesn't support S.
1224 is because it does not include mandatory spending? That's
a double negative, but I think you got my----
Mr. Payne. I, you know----
Senator Shaheen [continuing]. Intent.
Mr. Payne. Right now we use the net power revenues that we
get from our power projects there to be able to fund this
project, and taking away that ability to use these direct funds
and having to go to the appropriated dollars would then put a
strain on our appropriated dollars given the tight budgets, and
whether we'd be able to find the money or not to be able to
fund what we think is a worthy project is what the issue is.
Senator Shaheen. But wouldn't going forward with an
authorization of funding still be better than allowing that
authorization to expire? So going forward with the bill as it
is, even given the concerns that you've expressed, be
preferable to nothing?
Mr. Payne. I think it may be preferable, but I'd like to
get back to you on that question.
Senator Shaheen. OK.
Mr. Payne. Give you a detailed understanding of that. It's
a fairly complicated subject.
Senator Shaheen. Does Reclamation have suggestions for
programs to cut or revenues to generate so that the legislation
can move forward in the way that you would like?
Mr. Payne. We prefer the language that was I think proposed
in the prior--we'd like to be able to continue with the process
the way it currently is, where we can use our net revenues from
this project.
Senator Shaheen. Secretary Salazar submitted a required
report to Congress last year and indicated that the Department
would like to explore cost saving measures for the programs.
Have--has that effort begun, and are there cost saving efforts
that would ensure base funding needs continue to be met?
Mr. Payne. I also need to get back to you on that.
Senator Shaheen. OK.
Mr. Payne. I apologize for that.
Senator Shaheen. That's fine. Submit all of those questions
for you.
To go back to the Leadville Mine Drainage Tunnel Act, does
Reclamation support moving forward with this bill as
introduced, or are there specific changes that Reclamation is
recommending?
Mr. Payne. Reclamation supports the bill as it's been
revised. We feel that Senator Udall's office has worked really
hard on improving this legislation and responding to the issues
that we had previously had, and so we very much appreciate
those discussions and work and all the work that's gone into
that.
I think the real issue is that we need to get together as
an administration, the administration has to get together and
kind of work this all out among ourselves about what our issues
are and how we can all support this.
Senator Shaheen. So when you said that the department
supports the bill with revisions, you're not suggesting that
the revisions that you would like to see are reflected in the
current bill that's before the committee? You're suggesting
that there need to be additional revisions?
Mr. Payne. I think that we need to get together with the
other, like EPA and the rest of them, get us all in a room and
come up with some consensus on this whole issue and where we
all stand. That's pretty much what I know about the bill.
Senator Shaheen. OK. Thank you.
Mr. Payne. We will provide you, if you'd like, a little
detail on that.
Senator Shaheen. I think that would be very helpful for the
committee.
Mr. Payne. Thank you.
Senator Shaheen. On the Fort Sumner project conveyance, S.
1225, in 2009 Reclamation entered into a forbearance agreement
with the Fort Sumner Irrigation District and agreed to support
language in the title transfer legislation which would relieve
the District's repayment. Is Reclamation committed to working
with the District to ensure that it can meet its commitment to
purchase sufficient water from the District to equal the value
of the repayment amount?
Mr. Payne. We are committed to working with the District on
that issue.
Senator Shaheen. Does Reclamation have specific
recommendations for how to address the financial loss that your
testimony suggests may be present? Isn't the amount of loss
given what you just said in the control of Reclamation because
it's dependent on the rate that Reclamation pays the District
for water in the future?
Mr. Payne. We're currently in negotiations on the terms and
conditions with the Fort Sumner Irrigation District to work all
that out to see if we can come with--so we can get to the point
where we see that it's favorable financially for the United
States.
Senator Shaheen. S. 1225 authorizes Reclamation to transfer
title once NEPA and all other necessary conditions have been
met.
Mr. Payne. Correct.
Senator Shaheen. So the bill is subject to an agreement
governing the transfer process that Reclamation has already
negotiated with the District; correct?
Mr. Payne. Yes.
Senator Shaheen. So under those circumstances, aren't
Reclamation's process concerns addressed, and why is it not
appropriate to go ahead and move forward with this bill?
Mr. Payne. We still feel that the negotiations of the terms
and conditions, that the results of those negotiations need to
be embedded in the bill so everybody understands what the
concerns are and what all the parties' responsibilities are.
That's really where we're coming from.
Senator Shaheen. But given that it took 2 years for
Reclamation to move forward with the title transfer, can you
assure the District that Reclamation will continue to move this
process forward?
Mr. Payne. Yes. We're very committed. We've talked to the
region as well as the area office. I think in the past we did
have some turnover there, and we are working very diligently to
get this done. We're very supportive, and we're willing to help
them get through the Section 10 process and so forth. So we do
definitely want to help get this moving along.
Senator Shaheen. OK. Thank you.
Senator Lee?
Senator Lee. Thank you. I've got a couple of technical
lingering questions just related to the funding mechanism
contemplated in S. 1224. But because those get fairly far into
the weeds, if it's OK, I may just submit one or 2 of those
questions in writing and we'll deal with it that way.
Mr. Payne. I appreciate that.
Senator Lee. Thank you very much.
Senator Shaheen. Thank you, Senator.
I have only a couple of questions for Mr. Katz and Mr.
Barlow.
Mr. Katz, your testimony indicates that FERC does not
oppose S. 715 even though the legislation would violate the
previously held position that FERC does not support extensions
of time to develop hydroelectric projects for more than 10
years after the date of the original license. Does this mean
that there's been a shift in FERC's position on these matters,
or do the particular circumstances in this case warrant some
kind of a special consideration?
Mr. Katz. Senator Shaheen, there has not been a shift in
the Chairman's position from that he's previously taken or the
other chairmen of the agency, as I understand it. The
circumstances which I discussed take this essentially outside
this policy and make it a different type of case as far as
Commission staff is concerned.
Senator Shaheen. Great. Similarly, this bill would
substitute a new licensee for the previous licensee. Is that
standard practice for FERC to support that outcome, or again,
is this part of the unique circumstances in this case?
Mr. Katz. It's a relatively unusual circumstance. Typically
when there are reinstatement bills, the project is reinstated
to the original licensee. But under the circumstances of this
case, the Commission does not--or the Chairman has authorized
me to say that he does not oppose this legislation.
Senator Shaheen. OK. How did the timeline specified in the
bill compare to the timelines that FERC would ordinarily follow
for processing an application?
Mr. Katz. The timelines are fairly consistent with what
Commission staff thinks can be done. As I said in my testimony,
I do add one caveat, which is that Commission staff will need
to gather more information. It may need to look to the town--
forgive me for elevating you to a city--the Town of Canton for
that information, and it's also conceivable that issues would
arise involving the Fish and Wildlife, either Federal or state
agency, that might take more time to resolve. But absent that
sort of thing occurring, Commission staff feels that those
timelines are reasonable.
Senator Shaheen. Great. Has FERC received any notice from
the prior licensee, Summit Hydro, regarding the current efforts
to redevelop the hydropower at the location?
Mr. Katz. I don't believe so. I think there were times
earlier on, years ago, when Summit Hydro may have opposed that,
but I checked the record before I came here and I don't think
there's anything within the last few years in that regard.
Senator Shaheen. Good. Would the Collinsville Project be
eligible for small hydropower exemptions because the power
generated at those sites will be less than 5 megawatts?
Mr. Katz. I believe that's the case, but there are other
qualifications that apply that I'm not certain of. But, yes, I
believe they would qualify for that exemption.
Senator Shaheen. OK. Perhaps, Mr. Barlow, you could answer
that question.
Mr. Barlow. If I could, Senator. I'd like to refer to an
order granting re-hearing issued May 19, 2011. It was for a
project in Troy, Vermont. The project number is 13381-002. In
part, the license was reestablished after the hearing, but in
the finding number 11 of the FERC hearing commissioners, they
said ``Therefore, on a prospective basis, we conclude that
projects where the power house is located no further than 500
feet from the project dam.'' In this case, it was a dam in a
pen stock, and the power house was not actually sitting on the
dam.
What they said is, ``Therefore, on a prospective basis, we
conclude the projects where the power house is located no
further than 500 feet from the project dam which derive a
significant portion of head from the dam will qualify for a 5-
megawatt exemption.'' In the case of the Lower Collinsville
Dam, we're 650 feet distance between the power house and the
dam. So I would offer that based on this recent decision, that
we probably would not qualify for an exemption.
Mr. Katz. Senator, if I might just add----
Senator Shaheen. Yes, go ahead.
Mr. Katz. What the Commission has previously said is that
where a project is small and non-controversial, there really is
not much, if any, additional requirement or burden placed on an
entity to get a regular license, as opposed to a 5-megawatt
exemption license. So we would hope that we could work with the
town if indeed the licenses are reinstated to make the process
as painless and inexpensive as possible.
Senator Shaheen. I'm sure the town will appreciate that.
Mr. Barlow. We do.
Senator Shaheen. It sounds like this is a project that will
be very beneficial to the Town of Canton, and that you have
been successful so far at least in working with FERC to move
this application forward.
Mr. Barlow. If I might add, in response to their comments
about needing further information on environmental assessments,
we have received a grant from the State of Connecticut
Department of Environmental Protection for $100,000 to do a
management study of the upper impoundment, which is the most
significant one, and the results of that will be coming out
within the fall. So that will provide information on both the
aquatic community, the resources there, and the recreational
issues that could be of help in their study.
Senator Shaheen. Great. A final question. Has the town
heard from the previous license holder, Summit?
Mr. Barlow. There has been protracted discussions over a
period of time, nothing recently. They initially wanted us to
support them in a re-license and then purchase the rights from
them. We have gone out to bid to have a preliminary feasibility
study done. They had an opportunity to use the expertise they
had developed over their application submission and to have put
a proposal in for those consulting services. They chose not to
do that. So we think that they have had an opportunity to
participate, and they haven't.
Senator Shaheen. OK. Thank you.
Senator Lee, do you have other questions?
Senator Lee. Nothing further. Thank you.
Senator Shaheen. I have no other questions. If there's no
further testimony, Mr. Payne, we appreciate your marathon
responses on all of those pieces of legislation and thank all
of the witnesses who are here this afternoon.
The testimony and written submissions from today's
witnesses will be part of the official hearing record, and
we'll keep the record open for a period of 2 weeks to receive
additional statements. So, Mr. Payne, you'll have lots of time
to respond to those questions.
For the information of the senators and their staffs,
questions for the record are due by close of business tomorrow.
So, with that, the hearing is adjourned.
[Whereupon, at 3:32 p.m., the hearing was adjourned.]
APPENDIXES
----------
Appendix I
Responses to Additional Questions
----------
Responses of Grayford F. Payne to Questions From Senator Shaheen
s. 997
Question 1. Would Reclamation be supportive of a contract extension
for longer than four years if the Court process ends up extending
beyond 2013? If not, why not?
Answer. Yes, Reclamation would be supportive of a contract
extension for longer than four years if the Court process extends
beyond 2013. Reclamation has committed to continue to negotiate the
renewal of the 1958 contract with East Bench Irrigation District and
supports a contract extension until the Court decree is issued.
Legislation or the Montana Court decree are necessary in order to
ensure that the contract remains valid.
s. 1033
Question 1. What is the status of Reclamation's review of the Title
XVI program funding backlog? Have you determined which authorized
projects will not be going forward? Which projects have not yet met the
feasibility requirements?
Answer. The survey of sponsors of authorized Title XVI projects was
developed during the fall of 2010 and conducted in the spring of 2011
to avoid conflict with deadlines for submission of FY 2011 funding
applications. Responses from most sponsors were received in April 2011.
Reclamation continues to work with some project sponsors to clarify
responses where necessary. However, at this point we believe that nine
of the 53 authorized Title XVI projects have no plans requiring funding
in FY 2011, FY 2012, or FY 2013 and can be said to be ``inactive'' at
this time. These are:
Central Valley Water Recycling Project, Utah;
City of West Jordan Water Reuse Project, Utah;
Kalaeloa Seawater Desalination Project, Hawaii;
Lahaina Wastewater Reclamation Facility, Hawaii;
Lakehaven Water Reclamation and Reuse Project, Washington;
Las Vegas Area Shallow Aquifer Desalination Project, Nevada;
San Joaquin Area Water Recycling and Reuse Project,
California;
Truckee Watershed Reclamation Project, Nevada; and
Willow Lake Natural Treatment System Project, Oregon.
None of the projects listed above has yet met Title XVI feasibility
study requirements, although the Las Vegas Area Shallow Aquifer
Desalination Project is a demonstration project not subject to Title
XVI feasibility study requirements. In addition, the sponsor of one
other project, the Cucamonga Valley Water Recycling Project in
California, has met Title XVI feasibility study requirements but we
understand does not plan to move forward with its project as currently
authorized and plans to seek authorization for a revised project
instead.
In addition to the projects listed above, three authorized projects
expected to move forward in the next few years have not yet met Title
XVI feasibility study requirements:
City of Pasadena, California;
Kealakehe Water Recycling Project, Hawaii; and
Phoenix Metropolitan Water Reuse Project, Arizona.
One other authorized Title XVI project, the Southern California
Desert Region Integrated Water and Economic Sustainability Plan, has
met Title XVI feasibility study requirements for a portion of the
project but will likely include additional feasibility studies in the
future.
s. 1047
Question 1. Does Reclamation support moving forward with this bill
as introduced or are there specific changes Reclamation is
recommending?
Answer. Reclamation and the Department support the revisions made
to the bill and affirmed this in written testimony, citing the
sponsor's adoption of language to address previous concerns related to
reimbursement and liability. We understand the objective of this
language is to affirm existing discretionary authority to improve the
Reclamation-owned treatment plant at Leadville, as well as broaden
authority to enter reimbursement agreements with other entities for
further improvements to the tunnel or treatment plant upon mutual
agreement on funding responsibility.
s. 1224
Question 1. Although Section 9107 of the 2009 Omnibus Public Lands
Management Act extended the deadlines for several sections of the
legislation authorizing the Bureau of Reclamation to fund programs to
implement the Upper Colorado and San Juan Endangered Fish Recovery
Programs, that legislation did not extend the authority to utilize
power revenues for ``base funding'' activities. Does Reclamation have
sufficient authorization to continue those activities after 2011 or is
additional authorization beyond 2011 necessary?
Answer. Reclamation believes there is sufficient legal authority to
use appropriated dollars for base funding activities of the Programs.
Enactment of S. 1224 would provide a more explicit statutory authority
in this area but does not include an annual indexed ceiling as is
currently the case with P.L. 106-392.
s. 1225
Question 1. Your testimony indicates the bill may result in a
financial loss to the Treasury. Please describe the basis for that
opinion. Does Reclamation foresee a way to structure an agreement with
the District so that the Treasury remains whole?
Answer. Yes. Section 5 of the bill terminates repayment revenues
being collected by Reclamation for repayment of the Fort Sumner
Reclamation Project, and Section 6(a) terminates a portion of the
funding being paid by Reclamation to the Fort Sumner Irrigation
District (FSID) for the purchase of water for endangered species
habitat. The bill does not terminate the Forbearance Agreement nor the
obligation of the United States therein to continue to purchase water
for mitigation of the environmental impacts of FSID's diversions
through 2019. Since the repayment stream for the Fort Sumner project is
greater than the funding from Reclamation to the FSID for water,
Reclamation identified a potential financial loss to the Treasury under
Sections 5 and 6 of the bill. Through negotiations underway with the
FSID, Reclamation is working to formalize a Memorandum of Agreement in
order to determine responsibility for mitigation of FSID's diversions,
and thereby prevent any financial loss to the Treasury under the bill.
Recognition of a resolution of this could be included in an explicit
amendment to the bill.
Question 2. How does the potential need to acquire water to meet
Endangered Species Act requirements impact the repayment obligations
associated with the Fort Sumner Project?
Answer. The need to acquire water to meet the Endangered Species
Act (ESA) does not have any direct relationship with the repayment
obligations associated with the Fort Sumner Project. It is only through
the title transfer legislation that these processes have become linked.
Responses of Grayford F. Payne to Questions From Senator Lee
s. 500
Question 1. Has there been a title transfer of a reclamation
facility done administratively?
Answer. No. Pursuant to the Reclamation Act of 1902, the Bureau of
Reclamation has no general authority which would permit the transfer of
title to Reclamation facilities through an administrative procedure. As
a result, unless specifically authorized, no title transfers can be
completed without a specific Act of Congress. However, in order to
complete the title transfers in a timely and efficient manner,
Reclamation has developed an administrative process to negotiate the
terms and conditions of each title transfer at the local level, taking
into consideration the local concerns and issues that are relevant.
Once Reclamation and the transferee reach an agreement under the
administrative process, both parties work with Congress to enact the
necessary legislation to effectuate the agreement. The purpose of this
process, which was originally developed in 1995, and then updated in
2006 as part of Reclamation's Managing for Excellence effort, is to
efficiently and collaboratively facilitate title transfers in a
consistent and comprehensive way. This process, as articulated in the
Framework for the Transfer of Title, is structured such that interested
non-Federal entities may work with and through Reclamation to identify
and address all of the issues that will enable the title transfer to
move forward in an open and transparent manner. One of the important
ways to ensure that all of the issues and local concerns are addressed
is through completion of the process required under the National
Environmental Policy Act (NEPA). This ensures that the public has an
opportunity to have their views heard and addressed, which can limit
unanticipated obstacles when the legislative process begins.
Question 2. Please describe the number of transfers that have
occurred, both administratively, and directed congressionally. In
addition, please identify the transferred projects that included
language that the Secretary shall convey the project to the interested
parties.
Answer. Bureau of Reclamation has transferred title to 27 projects
or parts of projects across the west pursuant to various Acts of
Congress. Of those 27 projects, 15 included language that required the
Secretary to convey the project pursuant to the conditions of the
legislation. It is important to note, however, that in many of those
transfers which were completed between about 1997 and 2004, which
included the language ``shall convey'' in the legislation, the public
processes required under NEPA were completed and the terms and
conditions were publicly negotiated prior to the legislation being
enacted. Consequently, the underlying concern that was raised in my
testimony on S. 500--that the public be given the opportunity to raise
and have concerns addressed prior to enactment--was addressed in those
situations. As an aside, this concern was raised in testimony by the
Department of the Interior for those bills at that time and the issues
were addressed successfully.
Question 3. Does the Bureau of Reclamation anticipate any change of
use in the transferred facilities described in the bill?
Answer. No, as far as we understand, Reclamation does not
anticipate any change of use in the transferred facilities described in
this bill. Because the District has been operating and maintaining the
Distribution System for several years, the public will witness a change
in ownership but should not experience any change in operation. The Act
will eliminate uncertainty about ownership and obligations associated
with the Distribution System--which will likely lead to more efficient
and effective operation of the Distribution System.
s. 802
Question 1. Would implementing this bill cost any money? Would the
bill result in any additional water supply?
Answer. Enactment of S. 802 would not result in any cost to the
Federal government. All costs associated with importation of non-
project water into Lake Thunderbird would be borne by the Central
Oklahoma Master Conservancy District and its member cities.
Implementation of S. 802 would allow the Central Oklahoma Master
Conservancy District to store non-project water in Lake Thunderbird as
a means to fulfill its existing contractual M&I water deliveries to
project beneficiaries during periods of severe drought. The existing
water supply contract quantities were based on Reclamation's May 1961
Definite Plan Report (DPR) which assumed integration of groundwater
production with the operation of the Norman Project. Conditions have
changed, including lower Environmental Protection Agency (EPA)
standards for acceptable Arsenic levels, and supplemental groundwater
supplies which were expected to be available during periods of severe
drought appearing to no longer be adequate. Implementation of this
legislation could provide a means for the District to continue to
fulfill its contractual water deliveries through severe drought
periods.
s. 997
Question 1. Is there a legislative precedent for extending this
contract? If so, how many times has it been extended legislatively?
Answer. Yes, this contract was extended through two prior
appropriations bills: Public Law 108-447 in the 108th Congress and
Public Law 110-161 in the 110th Congress.
Question 2. Would a delay in extending the contract cause any short
or long-term problems? If so, please describe them.
Answer. Yes, a delay in extending the contract could result in the
contract expiring and the East Bench Irrigation District losing the
legal right to renew granted to them in the 1958 Contract.
s. 1033
Question 1. Beyond the certification of the feasibility study,
where in the process is the city and the BOR for determining Federal
environmental compliance actions, water contracts, determination of the
project sponsor's financial capability and so on?
Answer. Reclamation has completed the Federal environmental
compliance actions required under NEPA and Endangered Species Act,
which were necessary prior to a Reclamation Title XVI action (i.e.,
discharge of City of Hermiston's reclaimed water into the West
Extension Main Canal). Reclamation's Columbia-Cascades Area Office and
Umatilla Field Office staff are continuing to work through
implementation issues associated with:
a. construction, operations, and maintenance of the City's
pipeline and associated facilities which will be located on
Reclamation owned fee title land, (a Reclamation license has
been agreed to and is currently being signed by all parties);
and
b. the City's discharge of reclaimed water into Reclamation's
West Extension Main Canal (a Reclamation permit to discharge
recycled water into the canal is currently in draft and being
discussed among the parties).
Reclamation staff continues to work with the City to finalize the
permit to discharge reclaimed water into the West Extension Main Canal.
According to a letter from the Oregon Department of Environmental
Quality to the City dated June 29, 2011, the issue of the City
discharging Class A water into the canal was resolved, which appears to
clear up the remaining issue with the permit language.
Reclamation made a favorable determination on the City's financial
capability to meet the non-Federal portion of the project on August 17,
2011. All necessary financial information has been provided by the City
and is being reviewed by Reclamation.
Question 2. What is the status of the survey of authorized Title
XVI projects that the BOR requested from project sponsors last fall?
Answer. The survey of sponsors of authorized Title XVI projects was
conducted in the spring of 2011, after deadlines for submission of FY
2011 funding applications. Responses from most sponsors were received
in April 2011. Reclamation continues to work with some project sponsors
to clarify responses where necessary. However, at this point we believe
that enough information has been gathered to determine the general
status of each of the 53 authorized Title XVI projects as explained
above.
Question 3. Did you survey all Title XVI projects, or just those
that have not received funding?
Answer. Reclamation gathered information about all 53 authorized
Title XVI projects. A small number of projects for which Reclamation
already had current information were excluded from the survey.
Question 4. What were the results of the survey?
Answer. As a result of survey responses, at this point we believe
that nine of the 53 authorized Title XVI projects have no plans
requiring funding in FY 2011, FY 2012, or FY 2013 and can be said to be
``inactive'' at this time. In addition, the sponsor of one other
project, the Cucamonga Valley Water Recycling Project in California,
does not plan to move forward with its project as currently authorized
and plans to seek authorization for a revised project instead. Twenty-
five authorized Title XVI projects are either currently under
construction or are expected to seek additional funding in FY 2012 or
FY 2013. Finally, 18 authorized projects have now received their full
amount of Federal funding.
Question 5. Specifically, how many projects are no longer feasible
or are no longer seeking funding?
Answer. As set forth above, nine of the 53 authorized Title XVI
projects have no plans requiring funding in FY 2011, FY 2012, or FY
2013 and can be said to be ``inactive'' at this time and one other does
not plan to move forward with its project as currently authorized and
plans to seek authorization for a revised project instead.
Question 6. How many remain ``active'' (and how do you define
active)?
Answer. Twenty-five authorized Title XVI projects are either
currently under construction or are expected to seek additional funding
in FY 2012 or FY 2013. Those projects could be said to be ``active'' on
that basis.
Question 7. How many would you consider to be ``inactive'' or
perhaps no longer viable?
Answer. See Response to Question No. 5, above.
Question 8. What will be the agency's strategy if it does not get
the lump sum funding for Title XVI project funding, as depicted in the
FY2012 Budget?
Answer. In FY 2012, Reclamation is requesting $23.4 million in
funding to be awarded via a competitive funding opportunity, and $5.4
million in funding for six specific Title XVI projects identified for
funding previously. Reclamation's process to identify projects for FY
2012 funding will be similar to the process used in FY 2011, including
the use of criteria developed in 2010, and awards will be subject to FY
2012 Congressional appropriations. If competitive funding is not
included in final appropriations, Reclamation will move forward with
modifications to financial assistance agreements to allocate any
funding provided for the six projects listed in the budget request.
Question 9. How long might project sponsors expect to wait for
project funding under the proposed new system?
Answer. The obligation and expenditure of any appropriations to
Title XVI project sponsors--whether identified through a funding
opportunity or included specifically as part of appropriations--
requires a valid financial assistance agreement between Reclamation and
the project sponsor, as well as the submittal of reimbursement forms by
the project sponsors, before funding can be released. In FY 2011,
projects identified for award through Reclamation's funding opportunity
were selected in May, once appropriations were available. Reclamation
expects to obligate funding for each identified project by the end of
FY 2011--or about four months after the selection of each project.
Question 10. What has been the experience in using the funding
criteria thus far?
Answer. Projects identified for the award of FY 2011 appropriations
through Reclamation's funding opportunity were announced by Reclamation
on May 23, 2011, once appropriations were made available. Eight
projects were selected for construction and will together leverage
$11.3 million in Federal funds to complete a total of $99 million in
construction activities. The use of a funding opportunity afforded
project sponsors a chance to communicate to Reclamation the expected
benefits of each project--how each project can be expected to
contribute to water supply sustainability, benefits to the environment
and water quality, and any contributions to increased energy efficiency
in the delivery of water, among others. We believe the process has been
successful at allowing Reclamation to prioritize the projects that most
closely match program goals for funding through a process that is
transparent to all potential applicants and the public.
Question 11. Reclamation has stated that its ``efficiency''
performance measure goal for the Title XVI program is to reduce the
average annual Federal cost per acre-foot for Title XVI water from
approximately $1,873 a/f (FY2012 cost) to $1,200 per acre foot (by
2016). Given construction inflation costs and other limitations, is an
increase of this magnitude a realistic goal? What are the assumptions
underpinning this estimate and how does Reclamation plan to achieve it?
Answer. Reclamation calculates the referenced performance measure
goal by estimating the amount of water expected to be delivered by all
Title XVI projects in a given year and also estimating the cumulative
amount of Federal funding expected to be provided to all projects by
that point in time (i.e., program funding since 1992). Many projects
have received significant Federal funding but are under construction
and do not yet contribute water deliveries toward the goal. As those
additional Title XVI projects are completed, the total annual acre-feet
of reclaimed water through the program is projected to increase--from
313,152 acre-feet of deliveries in 2012 to 529,429 acre-feet of
deliveries in 2016. In other words, the average total Federal cost per
acre-foot today includes a significant amount of funding that will not
result in water deliveries for several years. We anticipate that once
those deliveries are included in the calculation, the average cost per
acre-foot of reclaimed water will be lower than the current figure.
s. 1047
Question 1. Please describe the work that the BOR has conducted, as
it relates to the safety of the Leadville tunnel. Do you believe it is
the obligation of the Bureau of Reclamation to be the lead Federal
agency?
Answer. Beginning in 2007, Reclamation began a Risk Assessment of
the Leadville Mine Drainage Tunnel (LMDT) in response to concerns in
the community about perceived dangers posed by water blockages inside
the tunnel. The assessment's purpose was to evaluate the stability and
assess the risk associated with the LMDT. When initial findings were
available, they were independently peer reviewed. The Risk Assessment
utilized a similar process to the one Reclamation uses to assess risk
at its dams, a model that is an international standard for conducting
risk assessments. The independent peer review confirmed Reclamation's
analysis that it is highly unlikely that a sudden release of water
could occur from either a blockage in the LMDT, or through the
bulkheads installed in the tunnel. Moreover, the assessment concluded
that even if an existing natural blockage in the upper part of the LMDT
failed rapidly, a sudden release of water through the lower blockage
and bulkheads is unlikely. When the Risk Assessment was published in
the early Fall of 2008, it was posted on the Internet and distributed
to the media. Reclamation conducted three public meetings and sought
public comment on the findings. We remain confident in the value of the
Risk Assessment and the validity of its findings. As the owner of the
LMDT, Reclamation is the lead Federal agency for the specific facility.
Question 2. If additional work is needed, do you believe the BOR
should be the lead agency, as it relates to any public safety and
environmental issues that may arise?
Answer. Insofar as the LMDT and the water treatment plant are
Reclamation facilities, the Department agrees that Reclamation is the
lead Federal agency for any public safety or environmental issues that
may arise that are unique to those facilities.
Question 3. If not, who should be the lead Federal agency, as it
relates to the operations of the tunnel, and any costs associated with
additional mitigation, if necessary.
Answer. As stated above, insofar as the LMDT and the water
treatment plant are Reclamation facilities, the Department agrees that
Reclamation is the lead Federal agency for any public safety or
environmental issues that may arise that are unique to those
facilities. If additional improvements to the LMDT or expansion of the
treatment plant are recommended by other beneficiaries or by agencies
involved at Leadville, Reclamation supports the language in S. 1047
providing the Secretary with the authority to enter into negotiations
with those entities for voluntary cost sharing agreements for those
improvements.
Question 4. Please describe the role that the BOR has played at
other superfund sites, in addressing water related issues. Is this a
core mission of the BOR?
Answer. Reclamation is not active at other superfund sites, and
remediation of environmental contamination is not a core mission of
Reclamation as defined by the Reclamation Act of 1902 and subsequent
authorities.
Question 5. Does Reclamation have any intention of walking away
from the project?
Answer. No. Reclamation maintains title to the LMDT and treatment
plant, and requests annual appropriations for operation of the plant.
As provided in Public Law 102-575, Reclamation is responsible for the
operation and maintenance of the treatment plant, and is also committed
to ensuring that waters discharged from the treatment plant do not
violate Federal and state law.
Question 6. Is the Leadville Treatment plant going to be part of
your budget in the foreseeable future? If yes, to what extent?
Answer. Yes. As stated above, pursuant to Public Law 102-575
Reclamation is responsible for the operation and maintenance of the
treatment plant, and is also committed to ensuring that waters
discharged from the treatment plant do not violate Federal and state
laws and regulation. The FY 2012 request for operation and maintenance
at the LMDT was $4,652,000.
s. 1224
Question 1. Please describe the potential effect on overall Federal
budgetary resources if this bill is authorized.
Answer. S. 1224 authorizes the Program to use appropriated dollars
and allows the current express authority for the use of Colorado River
Storage Project hydropower revenues under Section 3(d) of Public Law
106-392 to expire. This could increase pressure on Reclamation's
existing budget. The use of appropriated dollars is within existing
authorities. If S. 1224 were to be enacted, funding for these programs
would have to compete with other Reclamation priorities and programs.
Question 2. If the program is not extended, or if extended, not
fully funded by the Bureau of Reclamation, what would be the likely
impact on water users within the basin?
Answer. As stated in testimony, Program actions provide Endangered
Species Act compliance for more than 2,100 Federal, tribal, and non-
Federal water projects depleting more than 3.7 million acre-feet of
water per year in the Colorado and San Juan rivers and their
tributaries. Without the Program's activities, reinitiation of ESA
Section 7 consultations may be required by Federal agencies, resulting
in an assortment of potential new recommendations for water users
obliged to comply with reasonable and prudent alternatives in existing
and potentially updated biological opinions. Given Reclamation's
extensive water supply, conservation, and mitigation activities, this
program would have to compete with other Reclamation priorities for
funding in this environment.
Question 3. Does the Administration support recovery through
reliance on hydro reoperations that impact the generation of clean,
renewable hydropower?
Answer. Yes. The Administration supports the continued use of power
revenues to support the Recovery Programs. Under the Upper Colorado and
San Juan Recovery Programs Reclamation works with the FWS, WAPA and
power consumers to minimize impacts to hydropower generation while
achieving flow regimes which are compatible with endangered species
recovery. Flow regimes are one component of a comprehensive overall
strategy to achieve recovery.
Question 4. What is the current timetable and outlook for recovery
of these species in the Upper Colorado and San Juan Basins?
Answer. The table that follows outlines the downlisting and
recovery of species in the Upper Colorado and San Juan Basins. These
estimates are based on the best scientific information available and we
believe the goals are achievable.
------------------------------------------------------------------------
Species Downlist Delist
------------------------------------------------------------------------
Colorado Pike Minnow 2013 2020
Humpback Chub 2016 2019
Razorback Sucker 2020 2023
Bonytail Chub 2020 2023
------------------------------------------------------------------------
Question 5. How will you know when recovery has taken place?
Answer. The Recovery Goals for the species specify the population
demographic criteria that must be met along with the threats to the
species and their habitat that must be addressed. The Programs are
conducting monitoring activities to determine when these criteria are
met.
Question 6. Since the program began, have your goals changed on
what you would determine recovery to be?
Answer. For the most part the demographic criteria and species
threats specified in the Recovery Goals have remained essentially
constant although they are reviewed and updated on a periodic basis.
Question 7. Does the Administration have this funding request
included in its current budget request? (If not, what would be the
implications to the Program beginning in October 1, 2011?)
Answer. Reclamation does not have funding included in the
appropriations budget request but does have the funding included as
part of the Revenues budget submission in FY2012 and beyond as a
placeholder in the event that continued funding occurs through power
revenues. If these Programs are not funded there is a potential for re-
opening existing Biological Opinions and loss of Satisfactory
Sufficient Progress Determinations by FWS.
Responses of Grayford F. Payne to Questions From Senator Wyden
s. 1033
Question 1. Mr. Payne, your written testimony today is that the
Bureau recognizes the importance of water re-use projects like the
Hermiston project. Your testimony also states that the Bureau agrees
that the Hermiston project meets all of the requirements of Title XVI.
However, you stated today that the Bureau does not support S. 1033
because there are already 53 authorized projects and you don't want any
additional projects competing for funding with those already authorized
projects. You seem to take this position regardless of whether the
additional projects are more meritorious or even if the existing
projects are feasible. It is my understanding that a number of the 53
authorized projects have not, in fact, completed the feasibility review
and determination that the Hermiston project has completed. Is that
correct? If so, please provide a list of all of the previously
authorized projects that have not yet completed a feasibility study and
been determined to qualify for Title XVI. For each of those projects,
also provide the total estimated cost of the project and the share that
would funded by the Bureau under Title XVI.
Answer. It is correct that a number of authorized Title XVI
projects have not yet met Title XVI feasibility study requirements.
Because total estimated cost is not available for many projects that
have not yet completed feasibility studies, the share subject to
Federal funding through the Title XVI program can be recorded as the
maximum authorized cost share under P.L. 102-575. The following is a
summary of projects that have not yet met Title XVI feasibility study
requirements:
Central Valley Water Recycling Project, Utah ($20 million
Federal cost share);
City of West Jordan Water Reuse Project, Utah ($20 million
Federal cost share);
Kalaeloa Seawater Desalination Project, Hawaii ($20 million
Federal cost share);
Lahaina Wastewater Reclamation Facility, Hawaii ($20 million
Federal cost share);
Lakehaven Water Reclamation and Reuse Project, Washington
($20 million Federal cost share);
Las Vegas Area Shallow Aquifer Desalination Project, Nevada
($20 million Federal cost share);
San Joaquin Area Water Recycling and Reuse Project,
California ($20 million Federal cost share);
Truckee Watershed Reclamation Project, Nevada ($20 million
Federal cost share);
Willow Lake Natural Treatment System Project, Oregon ($20
million Federal cost share);
City of Pasadena, California ($50 million estimated project
cost; $12.5 million Federal cost share);
Kealakehe Water Recycling Project, Hawaii ($18 million
estimated project cost; $4.5 million anticipated Federal cost
share); and
Phoenix Metropolitan Water Reuse Project, Arizona ($20
million Federal cost share).
One other authorized project, the Southern California Desert Region
Integrated Water and Economic Sustainability Plan, has met Title XVI
feasibility study requirements that cover a portion of the project but
will likely include additional feasibility studies in the future. That
project has an estimated cost of $95 million, including a $20 million
Federal cost share.
Question 2. I understand that resources are scarce, but from a
management perspective what would be wrong with the Bureau prioritizing
the Title XVI projects based on their merits? Why should a project
that's already been shown to be feasible be excluded because others
simply got to front the line before they did?
Answer. The Title IVI program is part of the Department's efforts
through WaterSMART to secure and stretch water supplies for use by
existing and future generations. Reclamation has, in fact, recently
established a process to prioritize authorized Title IVI projects for
funding. In 2010, Reclamation developed funding criteria to identify
projects that most effectively stretch water supplies and contribute to
water supply sustainability; address water quality concerns or benefit
endangered species; incorporate the use of renewable energy or address
energy efficiency; deliver water at a reasonable cost relative to other
water supply options; and that meet other important program goals. In
FY 2011, Reclamation incorporated those criteria into a funding
opportunity announcement and invited eligible project sponsors to apply
for funding. Proposals were then evaluated against those criteria to
identify project phases for funding. Eligibility was limited to
authorized projects that had either completed an approved feasibility
study or submitted a feasibility study for review by the application
deadline. Reclamation will not provide construction funding for any
Title XVI project unless a feasibility study has been approved for that
project. Reclamation plans to allocate Title XVI Commissioner's Office
funding through a similar process in FY 2012.
Responses of Grayford F. Payne to Questions From Senator Udall
s. 1047
Question 1. In your testimony on S.1047, the Leadville Mine
Drainage Tunnel Act of 2011, you stated that ``the Department
interprets section 3 to affirm existing discretionary authority to
improve or expand the treatment plant as well as to allow the Secretary
to enter into reimbursement agreements with other entities with respect
to the treatment plant.'' Please expand upon what authority the
Department believes it has with respect to performing alterations to
the treatment plant, including expansion of the treatment plant. Also,
please expand upon what authority the Department believes the Secretary
has to enter into reimbursement agreements for services at the
treatment plant and performing alterations to the treatment plant.
Answer. The Department relies primarily on the language found in
Title VII of Public Law 102-575 as authority for its activities at
Leadville. Those authorities relate to design, construction, operations
and maintenance of the treatment plant and the rehabilitated portion of
the LMDT, up to the engineered bulkhead installed at Station 4 +66 (466
feet up tunnel from the portal).
Section 705 directs that the treatment plant ``shall be designed
and constructed to treat the quantity and quality of effluent
historically discharged from the Leadville Mine Drainage Tunnel.''
However, we do not interpret that language to explicitly preclude the
plant from treating surface waters diverted into the LMDT by U.S. EPA,
as is done via the Marian Shaft using an existing reimbursement
agreement with U.S. EPA.
Finally, with respect to cost sharing authorities, the Economy Act
(31 USC 1535) and existing Public Law 102-575 Section 708(c) provide
authority to the Secretary for reimbursement or cost-sharing
agreements. However, the existing statutory language in P.L. 102-575 is
not as broad as the two new authorities found in Sections 3 and 4 of S.
1047. The Department interprets Section 3 of S. 1047 as authorizing
cost-sharing agreements for an increase in any operation, maintenance,
replacement, capital improvement, or cost that is necessary as a result
of the expansion of the existing treatment plant due to an agreement
``with any other entity or government agency''. These other entities
could be the state of Colorado, a municipal subdivision or county, or
other entity. Separately, the Department interprets Section 4 of S.
1047 as authorizing cost sharing agreements with U.S. EPA or other
entity or government agency, that are conditioned upon the EPA's
issuing a new or amended Record of Decision for Operable Unit 6 of the
California Gulch Superfund site for the improvement or expansion that
would be undertaken with the funding. Because of its use of the term
``agreement,'' and by conditioning the transmittal of any funding on
specific recommendations from the funding entity, the Department
interprets S. 1047's language as preserving the discretion of any and
all participating entities.
______
Responses of John Katz to Questions From Senator Shaheen
on S. 715
Your testimony indicates that FERC does not oppose S. 715 even
though the legislation would violate the previously held position that
FERC does not support extensions oftime to develop hydropower projects
for more than 10 years after the date of the original license.
Question 1a. Has there been a shift in FERC's position on these
matters, or do the particular circumstances in this case warrant some
kind of special consideration?
Answer. I do not believe that there has been any shift in Chairman
Wellinghotl's position regarding extension bills. As I testified, the
factors that have caused concern to Chairman Wellinghoff and previous
chairmen have been whether an extension involves site banking, whether
there is a negative impact on competition in hydropower development,
and whether the environmental record for the project in question is
stale. These concerns do not arise with respect to the Collinsville
projects because (1) the project is not being held by the prior
licensee, but rather is being transferred to another entity which has
not previously had the chance to develop the project, (2) in the time
since the project license was terminated, the Commission is not aware
of other entities beside the Town of Canton seeking to develop the
project site, and (3) the bill requires the Commission to complete an
environmental assessment updating the environmental record to the
extent necessary.
Question 1b. Similarly, this bill would substitute a new licensee
for the previous licensee. Is it a standard practice for FERC to
support that outcome?
Answer. To my knowledge, because a legislative substitution of one
licensee for another is so rare, the Commission does not have a
standard practice with respect to taking a position on such
legislation. I am only aware of one previous instance, Section 315 of
P.L. 107-137, involving the Stuyvesant Falls Project No. 2696, in which
Congress required such an outcome. I do not believe that then-Chairman
Wood expressed support for that legislation.
Question 1c. How do the deadlines specified in this bill compare to
the timeframes that FERC would ordinarily follow for processing an
application? Would moving forward with this bill save the Town any
time?
Answer. S. 715 would require the Commission to reinstate and
transfer the licenses for the Collinsville Project within 270 days of
the date of enactment. The timeframes that the Commission requires to
process a filed application vary widely, depending on the complexity of
the case, whether it is contested, and how much time federal and state
resource agencies take to issue any necessary conditions and approvals.
The 270-day deadline established in the bill is consistent with the
time frames for a case that is not complex, not contested, and does not
involve significant time for agency action. Moving forward with the
bill might save the town time compared with filing a new application,
again dependent on the factors I have mentioned, particularly the
amount of time it would take resources agencies to act with regard to a
new application.
Question 2. What notice has FERC received from the prior licensee,
Summit Hydro, LLC, regarding the current efforts to redevelop
hydropower at this location?
Answer. To the best of my knowledge, Summit Hydro, LLC has not made
any filing with the Commission in the last several years regarding the
current efforts by the Town of Canton to redevelop the Collinsville
Projects.
Appendix II
Additional Material Submitted for the Record
----------
Statement of Ed Brookshier, City Manager, City of Hermiston, OR,
on S. 1033
Madam Chairman Shaheen and Members of the Subcommittee, thank you
for holding this hearing and allowing me to testify in support of
S.1033 that will authorize the Bureau of Reclamation to participate in
the construction of the City of Hermiston Water Recycling Project. My
name is Ed Brookshier and I am the City Manager for the City of
Hermiston, Oregon. I wish to publicly thank Senator Ron Wyden for
introducing this important piece of legislation that is crucial to the
City's reclamation and reuse of its municipal wastewater. This
reclamation effort will provide high quality recycled water for reuse
as a source of irrigation supply. The City's recycled water production
is estimated to be 3,600 acre-feet annually, of which 1,800 Acre-feet
will supply irrigation and 1,800 acre-feet will be discharged to the
Umatilla River in winter. This new partial source of drought proof
irrigation water will provide an added supply to the Bureau of
Reclamation owned and locally operated West Extension Irrigation
District (WEID).
The City is in the process of negotiating an easement license with
the Bureau of Reclamation for the recycled water pipeline that will
deliver the recycled water to the WEID Main Canal. This license allows
the City to construct and operate the recycled water pipeline for a
period of 25 years with the ability to extend the license based on
mutual agreement of the Bureau of Reclamation and the City. The City is
also in the process of negotiating the permit to discharge the recycled
water to the irrigation canal. This permit will establish the water
quality criteria and operating conditions for the recycled water
discharge to the irrigation canal. The Bureau of Reclamation and the
City are meeting to finalize this agreement in June 2011 and it is
anticipated that the final permit will be signed in August 2011. A
comprehensive feasibility study has been completed on the project and
the Bureau of Reclamation has certified that it meets the requirements
to be eligible for the Bureau's Title XVI Water Recycling Program.
Hermiston, Oregon is a progressive, growth-oriented urban center
with a total trade area population of 320,900. Located in a relatively
dry section of the state of Oregon, positioned between the Cascade
Mountains to the west and the Blue Mountains to the East, Hermiston is
placed in a unique geographical area that offers an extended growing
season and a variety of agricultural crops and products. The immediate
Hermiston area has been able to diversify its economy with food
processing, cold storage and warehousing and distribution facilities.
The benefits of developing a high quality source of recycled water
followed by its use as a source of irrigation are numerous and extend
to: The West Extension Irrigation District, the City of Hermiston, The
Confederated Tribes of the Umatilla Indian Reservation and the region
as a whole.
The West Extension Irrigation District benefits from this project
by obtaining an additional source of supply, which is both high in
quality and drought proof. Since water is delivered to the District,
energy required for pumping is also reduced by approximately $13,000
annually. In addition, the 1,800 acre-feet of irrigation water provided
annually will supply water to 600 acres, reducing the demand on the
District's surface water supply sources. Finally, this added source of
partial irrigation water improves the District's operational
flexibility.
The City of Hermiston benefits primarily through meeting its
upcoming National Pollutant Discharge Elimination System Permit
(NPDES), which is currently being negotiated with the Oregon Department
of Environmental Quality (ODEQ). The City has received support for this
project at the highest levels of ODEQ and has been promised that the
resources will be made available to complete the permitting process by
early 2012. This permit requires the City to both develop high-quality
recycled water and remove its discharge from the Umatilla River
continuously from April 1 to October 31 of each year. The West
Extension Irrigation District provides the long term, multi-farm
discharge option that allows the City to remove its discharge from the
River during this period of each year. If the City is unable to
discharge to the District it will be in continuous violation of current
temperature standards and periodic violation of the ammonia standard
contained within the City's NPDES Permit. Secondary benefits to the
City include a reduction in energy cost from reduced pumping, estimated
to be $42,000 annually, and the certainty that this solution, though
expensive, will provide service for decades to come.
The Confederated Tribes of the Umatilla Indian Reservation will
also benefit from development of high-quality recycled water throughout
the year. These benefits include a significant improvement in the
quality of recycled water discharged to the Umatilla River in winter,
further protection of sensitive salmonid habitat during summer when the
recycled water is used for irrigation in lieu of River discharge,
increased environmental monitoring at the recycled water treatment
facility and the long-term nature of this solution.
The region as a whole also benefits from treatment that develops
high-quality recycled water. This water source is protective of the
environment in both summer and winter and provides an added source of
irrigation supply to agriculture, which is the backbone of the
Hermiston economy. The City is planning on beginning construction of
the Recycled Water Plant in early 2012 to take advantage of a very
competitive construction-bidding environment. This effort will have an
immediate economic impact to our local economy as much needed jobs will
be created through an infrastructure project of this size. More
importantly, the addition of the new and reliable water source created
by this project will have a profound long-term impact to the farming
industry in our area, which faces an uncertain future due to dwindling
water supplies.
Madam Chairman, while I understand and appreciate the strict
budgetary limitations that your Committee and Congress as a whole are
faced with, I believe that the Hermiston Recycled Water facility is a
worthwhile federal investment due to the numerous federal objectives
that will be advanced through this project. Combined with the serious
regulatory issues the City of Hermiston is faced with and the need for
added drought proof sources of recycled water in the Hermiston Area for
irrigation, it is essential that we complete construction of this
project in a timely manner. The City has secured the necessary local
matching funds for this project and is prepared to contribute 75
percent of the total project cost. Federal participation in this
endeavor is vital to ensure that this becomes a reality.
______
Statement of Richard D. Moore, Mayor of Payson City, Payson, UT
on s. 500, s. 715, s. 802, s. 997, s. 1033, s. 1047, s. 1224, s. 1225
I appreciate the opportunity to submit this statement for the
record in support of S. 500, the South Utah Valley Electric Conveyance
Act. My name is Richard Moore and it is my privilege to serve as Mayor
to the best little town in Utah, Payson City. Payson was incorporated
as a city on January 21, 1853 and has a present day population of
around 18,500 residents. Payson is one of the fastest growing
communities in Utah.
I want to also thank Senator Orrin Hatch and Senator Mike Lee for
introducing this important legislation. S. 500 would direct the
Secretary of the Interior to convey and transfer title to those
portions of the electrical distribution system that are owned by the
United States, including the land on which those facilities are
located. It will also provide license and use of shared power poles and
access to lands where distribution facilities are located. SESD's
electrical distribution system overlaps land and system fixtures that
are still owned by the United States. Consolidation of ownership and
service will create an opportunity for savings that will eventually
lower rates to all our customers and make the maintenance and expansion
of the system more efficient.
Payson has historically been a farming community. Principal crops
have been grass hay, which the pioneers found growing wild when they
arrived, lucerne (alfalfa), and grains such as wheat, barley, oats, and
corn; beets, potatoes, and onions and fruit such as apples and
cherries. Cattle, sheep, and hogs are also raised in the area.
Gradually we have attracted businesses and new industry. Over recent
years, we have attracted manufacturing plants for motor homes, campers
and trailers, and fiberglass boats. As the area grew and Payson needed
to annex more land for homes and businesses, Payson has worked to find
adequate water and electricity. Additional water will become available
following the construction and Central Utah Project Bonneville Unit,
which promises to deliver new supplies of water to our area when the
Utah Lake System of pipelines is completed.
Electrical customers in Payson City boundaries are generally served
as retail customers of Payson Power and Light Department whose mission
has been to serve the residents of Payson with safe, efficient and
reliable power, at the most economical cost. We receive a portion of
our power over SESD distribution lines. Recently, the Payson City
Council approved an inter-local agreement to integrate our city power
functions with SESD. This agreement will avoid a duplication of service
in the area surrounding Payson city. We have found that if we don't
work together it is detrimental to the growth of the community.
SESD serves the areas outside the South Utah County cities and
delivers power to us for delivery inside our city boundaries. Payson
has concluded that we need to consolidate all our electric distribution
operations to avoid duplication of service and capitalize on
inefficiency. S. 500 will be a tremendous help to accomplish this goal
because it will consolidate the mish mash of ownership over miles of
distribution lines throughout the south county. There are costs and
inefficiencies resulting from this unconsolidated patchwork quilt
ownership pattern. For example, when property is annexed into Payson
City, the city is required to buy out all of SESD'S facilities and pay
lost revenues for 10 years and pay severance costs. After this
requirement has been completed, then the developer is required to
install new facilities as per Payson Power Department's standards.
By joining together and utilizing the efficiencies of employees,
equipment, inventory, resource management and all other aspects of a
power system optimization management plan we can reduce costs to our
customers and residents. In addition, we lower costs to businesses
seeking to relocate or developers planning to annex into Payson City.
Consolidation will create an opportunity for future businesses to
locate in Payson without expensive upfront costs. We fully support S.
500 as it will help us achieve these goals to stimulate growth and job
creation in our area.
______
Statement of Blair R. Hamilton, Chairman of the Board of Directors,
South Utah Valley Electric Service District
on s. 500, s. 715, s. 802, s. 997, s. 1033, s. 1047, s. 1224, s. 1225
I am grateful to be able to submit this statement in support of S.
500, the South Utah Valley Electric Conveyance Act. My name is Blair
Hamilton and I serve as Board Chairman of South Utah Valley Electric
Service District (SESD). I want to also thank Senator Orrin Hatch and
Senator Mike Lee for introducing this important legislation. SESD was
formed by the Utah State legislature to deliver electricity to the
unincorporated rural communities in south Utah County including the
cities of Elk Ridge and Woodland Hills. SESD also provide service to
many customers in the cities of Payson, Salem, Spanish Fork, Santaquin
and Mapleton.
SESD's electrical distribution system overlaps land and system
fixtures that are still owned by the United States. S. 500 would direct
the Secretary of the Interior to convey and transfer title to those
portions of the electrical distribution system that are owned by the
United States, including the land on which those facilities are
located. It will also provide license and use of shared power poles and
access to lands where distribution facilities are located. S. 500 will
help to provide certainty to SESD as it continues to make improvements
to the system and operate and maintain what is in place today.
On April 7, 1986, the Strawberry Water Users Association conveyed
by sale to SESD both ownership and operation of the entire electric
distribution system. The SESD electric distribution system was
originally built as part of the Strawberry Valley Project, which was
completed by June 30, 1922. The Strawberry Valley Project was one of
the earliest Bureau of Reclamation irrigation projects to develop
hydroelectric energy. Original project features included Strawberry Dam
and Reservoir, Indian Creek Dike, Strawberry Tunnel, two diversion
dams, three power plants, a main canal system, and a portion of the
lateral system. Electric power from these facilities was used to
construct the Strawberry Tunnel and Dam. Two of the power plants were
constructed by the Strawberry Water Users Association (Association).
Approximately 4,000 kilowatts of power are developed in three power
plants on the project and are delivered through transmission lines to
our distribution system. Today, most of the water conveyance features
of the Strawberry Valley Project have been integrated into the
Bonneville Unit of the Central Utah Project.
Historically, the Strawberry Water Project was governed by a 1926
Repayment contract between the Bureau of Reclamation and the Strawberry
Water Users Association, which was amended on November 20, 1928 and
again on October 9, 1940. This Repayment agreement transferred
responsibility to the Association for the operation and maintenance of
the power system, which included power generation, transmission and
distribution facilities. The Repayment contract did not transfer title
to any of these facilities to the Association, which remained in the
name of the United States. On August 8, 1972, the Office of the
Solicitor stated in an opinion that the United States owned those
portions of the power system constructed with project revenues or that
``became fixtures on the lands to which title was in the United
States.'' An additional Solicitor's Opinion dated August 14, 1985
clarified further that:
Title was reserved in the United States to all project
property (including the power system) as of the time of the
1940 contract, but title was not reserved in the United States
to such additions to the project (including additions to the
power system) as were made after the 1940 contract unless the
additions became fixtures on the lands to which title was in
the name of the United States or unless it was expressly
provided in connection with and approval sought from the
Secretary.''
Despite this clarification, it is difficult to determine exactly
which parts of the system are owned by the United States and which are
now owned by SESD. There remains no dispute that the United States
retains title to those portions of the distribution system constructed
prior to 1940 with Strawberry Valley Project revenues or that are
located on lands titled to the United States. However, from a practical
standpoint, there has been increased uncertainty regarding where
project revenues were spent for either construction of or improvements
to the electric distribution system. Much of the electric distribution
system was constructed on easements over private lands owned by
Association members. This creates significant operational challenges as
SESD complies with the Operation and Maintenance Agreement.
Furthermore, Reclamation and SESD just concluded a new agreement
whereby SESD agrees to operate and maintain the federal portions of the
SESD distribution system. The agreement requires SESD to assume a
number of special responsibilities regarding maintenance or
improvements to the federally owned portions of the system. The
agreement recognizes that it is not presently possible to determine
with certainty which portions of the system are owned by the United
States and contemplates a further need to inventory the distribution
system to ascertain ownership. Reclamation estimates it will take years
to accurately determine which portions were constructed prior to 1940,
with project revenues or are located on federally owned lands. This
places a significant cost burden on SESD and Reclamation.
In order to resolve these complications, SESD has been working with
the Bureau of Reclamation and it was suggested that transferring title
is the right approach.
Although we are not seeking to transfer a water project, we believe
that this transfer is consistent aspects of the Framework for the
Transfer of Title Bureau of Reclamation Projects of August 7, 1995.
That policy document outlines six criteria for the title transfer of
uncomplicated, single purpose reclamation projects or features and
although it was drafted primarily to apply to water projects.
They are as follows:
1) The Federal Treasury, and thereby the taxpayer's financial
interest, must be protected.
2) There must be compliance with all applicable State and
Federal laws.
3) Interstate compacts and agreements must be protected.
4) The Secretary's Native American trust responsibilities
must be met.
5) Treaty obligations and international agreements must be
fulfilled.
6) The public aspects of the project must be protected.
By transferring the federally-owned portion of the SESD electric
distribution system, S. 500 will not only simplify SESD's ability to
operate and maintain this system, but it will provide mutual benefits
to Reclamation by transferring once and for all legal responsibility
for the system to SESD.
Again I want to thank you for the opportunity to submit this for
the record.