[Senate Hearing 113-32]
[From the U.S. Government Publishing Office]
S. Hrg. 113-32
MISCELLANEOUS 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 THIRTEENTH CONGRESS
FIRST SESSION
ON
S. 211 S. 693
S. 284 S. 715
S. 510 S.J. Res. 12
S. 659 H.R. 316
S. 684 S. Amdt. 579
__________
APRIL 16, 2013
Printed for the use of the
Committee on Energy and Natural Resources
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COMMITTEE ON ENERGY AND NATURAL RESOURCES
RON WYDEN, Oregon, Chairman
TIM JOHNSON, South Dakota LISA MURKOWSKI, Alaska
MARY L. LANDRIEU, Louisiana JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont MIKE LEE, Utah
DEBBIE STABENOW, Michigan DEAN HELLER, Nevada
MARK UDALL, Colorado JEFF FLAKE, Arizona
AL FRANKEN, Minnesota TIM SCOTT, South Carolina
JOE MANCHIN, III, West Virginia LAMAR ALEXANDER, Tennessee
CHRISTOPHER A. COONS, Delaware ROB PORTMAN, Ohio
BRIAN SCHATZ, Hawaii JOHN HOEVEN, North Dakota
MARTIN HEINRICH, New Mexico
Joshua Sheinkman, Staff Director
Sam E. Fowler, Chief Counsel
Karen K. Billups, Republican Staff Director
Patrick J. McCormick III, Republican Chief Counsel
------
Subcommittee on Water and Power
BRIAN SCHATZ, Hawaii, Chairman
TIM JOHNSON, South Dakota MIKE LEE, Utah, Ranking
MARIA CANTWELL, Washington JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont JAMES E. RISCH, Idaho
DEBBIE STABENOW, Michigan DEAN HELLER, Nevada
JOE MANCHIN, III, West Virginia JEFF FLAKE, Arizona
AL FRANKEN, Minnesota TIM SCOTT, South Carolina
Ron Wyden and Lisa Murkowski are Ex Officio Members of the Subcommittee
C O N T E N T S
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STATEMENTS
Page
Baucus, Hon. Max, U.S. Senator From Montana...................... 18
Johnson, Hon. Tim, U.S. Senator From South Dakota................ 2
Katz, John, Deputy Associate General Counsel, Federal Energy
Regulatory Commission.......................................... 3
Lee, Hon. Mike, U.S. Senator From Utah........................... 2
Quint, Robert, Senior Advisor, Bureau of Reclamation, Department
of the Interior................................................ 5
Schatz, Hon. Brian, U.S. Senator From Hawaii..................... 1
APPENDIXES
Appendix I
Responses to additional questions................................ 29
Appendix II
Additional material submitted for the record..................... 33
MISCELLANEOUS WATER AND POWER BILLS
----------
TUESDAY, APRIL 16, 2013
U.S. Senate,
Subcommittee on Water and Power,
Committee on Energy and Natural Resources,
Washington, DC.
The subcommittee met, pursuant to notice, at 2:30 p.m. in
room SD-366, Dirksen Senate Office Building, Hon. Brian Schatz
presiding.
OPENING STATEMENT OF HON. BRIAN SCHATZ, U.S. SENATOR FROM
HAWAII
Senator Schatz. Good afternoon. I'd like to welcome
everyone here today.
Today's hearing involves several bills that are pending
before the Subcommittee on Water and Power. The bills cover
different aspects of our water and power jurisdiction including
rural power and hydro power. A majority of them have gone
through some committee process in the previous Congress.
I'd like to spend just a few minutes discussing Senate
joint resolution 12 because it pertains to my home State of
Hawaii and to the welfare of those in the native Hawaiian
community, who have land leases under the Hawaiian Homes Land
Program. This program was established by Congress and enacted
into law in 1921 when Hawaii was still a territory in order to
ensure native Hawaiian people would have land set aside where
their communities could continue to thrive. In 1960 under the
State of Hawaii Admission Act the United States required the
State of Hawaii to administer certain portions of this Federal
trust responsibility.
The State of Hawaii incorporated that delegated
responsibility into its own constitution and body of law. The
program is administered by the Department of Hawaiian
Homelands, an agency of the State of Hawaii with certain
oversight responsibilities retained by the United States and
exercised by the Department of Interior and the Congress. The
Congress retained the authority to review and consent to
certain amendments made to this program by the Hawaii State
Legislature.
Senator Hirono and I introduced this legislation to provide
the required consent of Congress to 3 amendments enacted by the
State of Hawaii to the Hawaiian Homes Commission Act of 1920.
The Secretary of the Interior has determined that Congressional
consent and approval is needed for the amendments to become
effective. These amendments would give a homestead leasee the
authority to transfer their interest in a lease to certain
family members and to designate certain family members to
succeed to the lease hold interest at the time of a death. The
amendments would also allow the Hawaiian Homes Commission to
establish an interest rate on loans from Hawaiian home loan
funds.
I plan to work with the chairman and others on this
committee to get congressional consent for these amendments.
There are a number of other bills on the agenda today. I
look forward to learning more about them.
Now I'll turn to our ranking member, Senator Lee, for his
opening comments.
STATEMENT OF HON. MIKE LEE, U.S. SENATOR FROM UTAH
Senator Lee. Senator Schatz, it's a pleasure to be here
today.
I thank you for chairing this hearing on a number of water
and power measures, two of which are integral to my home State
of Utah, S. 211, the Provo River Project Transfer Act and S.
510, the Scofield Land Transfer Act. I've co-sponsored both of
these bills with my colleague Senator Hatch.
The Provo River Project Transfer Act will enable the full
transfer of the Provo Reservoir Canal to the Provo River Water
Users Association.
As contemplated by a previous bill that was passed in 2004,
the Scofield Land Transfer Act will resolve long standing
discrepancies with regard to private property near Scofield
Reservoir in Carbon County, Utah.
The bills before us today have had hearings in the previous
Congress and address many of the issues we'll be examining over
the next couple years. These issues include mechanisms to
provide safe and reliable water supplies for rural communities
and opportunities to improve our power supplies. So while the
underlying purpose of each bill before us today is different,
they all attempt to identify tools to ensure that our power and
our water and our power facilities are both safe and reliable.
I thank the Federal witnesses for being here today. I thank
you, Senator Schatz, for conducting this hearing. I look
forward to the testimony.
I do note at the outset, I'm also the ranking member on the
Anti-trust Subcommittee, so I may be having to bounce back and
forth between these two. So with that understanding, I'll turn
it back over to you.
Thank you.
Senator Schatz. Thank you, Ranking Member Lee.
Senator Johnson, opening remarks.
STATEMENT OF HON. TIM JOHNSON, U.S. SENATOR FROM SOUTH DAKOTA
Senator Johnson. Thank you, Chairman Schatz and Ranking
Member Lee. I appreciate this opportunity to speak in support
of two bills on today's agenda: the Mni Wiconi Project Act
Amendments, S. 684, and the authorized Rural Water Projects
Completion Act, S. 715.
The Mni Wiconi Amendments bill addresses a shortfall in
construction funding and facilitates key infrastructure
improvements to ensure that the Mni Wiconi rural water project
can be completed. This project has brought together 3 tribal
rural water systems and one non-tribal rural water system to
deliver quality water to areas that historically faced
insufficient and, in too many cases, unsafe drinking water. Mni
Wiconi also offers economic hope to 3 Indian reservations in my
State that face some of the most challenging levels of
unemployment and poverty in the Nation. Nearly 25 years after
it was first authorized, the ball is on the one yard line with
this project. I remain committed to seeing it through.
We also need to do more to address the growing backlog of
Bureau of Reclamation rural water projects. I'm a co-sponsor
and strongly support the Authorized Rural Water Projects
Completion Act. The bill will provide substantial, dedicated
funding to speed construction of congressionally authorized
projects.
After historic investments in rural water through the
Recovery Act, discretionary budget requests for projects like
the Lewis and Clark Regional Water System have fallen to levels
insufficient to make any meaningful progress. This legislation
offers a new approach to get these projects back on track and
bring economic development opportunities to the communities
they serve.
I look forward to working with my colleagues on this
committee to move this legislation forward, and I thank Senator
Baucus for all his efforts.
I would also note that the Lewis and Clark Regional Water
System will be submitting written remarks in support of this
bill that I ask be included in the record.
Thank you, Mr. Chairman.
Senator Schatz. Thank you, Senator Johnson.
I'm informed that Senator Baucus is on his way and should
be with us very shortly. So we'll wait for him before we
proceed to the witnesses.
[RECESS.]
Senator Schatz. I think what we'll do is proceed to the
FERC testimony so that you can provide your testimony on the
first bill.
So could we have John Katz from the Federal Energy
Regulatory Commission provide his testimony? Thank you.
STATEMENT OF JOHN KATZ, DEPUTY ASSOCIATE GENERAL COUNSEL,
FEDERAL ENERGY REGULATORY COMMISSION
Mr. Katz. Good afternoon.
Thank you very much for asking the Commission to appear
before the subcommittee to testify on Senate Amendment 579 and
H.R. 316 which are both named the Collinsville Renewable Energy
Promotion Act. These proposed bills relate to two projects that
were licensed by the Federal Energy Regulatory Commission some
time ago to a private developer. The Federal Power Act requires
the Commission to require a developer to start construction
within 2 years of receipt of a license and allows the
Commission to extend that once for another 2 years.
The Commission did that with respect to this developer. At
the end of that time, again, as required by the Federal Power
Act, the Commission revoked the license. So between that period
and now, which is a period of about 6 or 7 years, I think,
there's been no interest in developing the site. The proposed
bills would authorize the Commission to reinstate the licenses
and to transfer them to the Town of Canton, Connecticut after
performing an appropriate environmental review and receiving
appropriate public comment.
While generally the comments that I give are my own and
don't reflect the opinions of the chairman or of any
commissioner. The chairman has authorized me to say that he
does not oppose this bill because of the lack of competition
for the site so that the bill in no way adversely affects
competition and because of the provisions requiring
environmental review. So there's no question that the
environmental review done under the previous licensing will be
stale.
With that I'll yield back the balance of my time. I'd be
happy to answer any questions.
[The prepared statement of Mr. Katz follows:]
Prepared Statement of John Katz, Deputy Associate General Counsel,
Federal Energy Regulatory Commission
ON S. AMDT. 579 AND H.R. 316
Chairman Schatz, 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. Amdt. 579 and H.R. 316.
As a member of the Commission's staff, the views I express in this
testimony are my own, and not those of the Chairman or of any
individual Commissioner, other than as specifically noted below.
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. AMDT. 579 AND H.R. 316
S. Amdt. 579 and H.R. 316 would authorize the Commission to
reinstate either or both of the licenses for the Upper and Lower
Collinsville Projects, to extend for two years the commencement of
construction deadline for the projects, and to transfer the license or
licenses to the Town. As specified in S. Amdt. 579, the Town would be
subject to the terms and conditions of the prior license(s) and both
bills provide that the Commission will add to the license(s) any
additional terms and conditions the Commission deems to be necessary.
In addition, both bills provide that the Commission will supplement
the environmental analysis prepared in connection with the issuance of
the prior licenses, to examine all new circumstances or information
relevant to environmental concerns relating to the reinstated licenses.
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,
that competition in the development of hydropower projects should be
encouraged, and that environmental information may over time become
stale.
In this instance, the proposed extensions would run at least three
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 more than five years since the project licenses were
terminated, no entity has sought to develop the projects or proposed
other uses for the project sites, thus ameliorating concerns about
competition or release of the sites. Moreover, because the bills
specifically provide for the preparation of an updated environmental
analysis, staleness of the environmental record will not be an issue.
In consequence, I am authorized to state that Chairman Wellinghoff does
not oppose S. Amdt. 579 or H.R. 316.
I would be pleased to answer any questions you may have.
Senator Schatz. Mr. Katz, your testimony indicates that
FERC doesn't oppose this legislation even though it's
inconsistent with the previously held position that FERC does
not support extensions of time to develop hydropower projects.
Has there been a shift in the FERC position to allow for more
flexibility or is this a one off, in your opinion?
Mr. Katz. No, I don't think so. It's closer to a one off.
The past few chairmen have indeed held the position that after
10 years from when the date a license had been issued is a long
enough period for a developer to develop a project. But in this
instance the extension bill is not benefiting the same
developer. It's benefiting a municipality. As I said, two
factors, I think, were primary in our thinking.
One was that there's been no one trying to take the site,
so that Congress' action would not in any way adversely affect
competition.
The second issue that comes up over a period of time is
that the environmental record may become stale. But both of
these bills provide that the Commission shall update the
environmental records. So the Commission's concerns, as a
general matter, have been assuaged in this case.
Senator Schatz. Thank you.
Thank you, Mr. Katz.
Mr. Katz. Thank you very much.
Senator Schatz. Senator Heinrich, would you like to make an
opening statement?
Senator Heinrich. No, thank you.
Senator Schatz. I think we'll proceed to the second
witness, Robert Quint, the Senior Advisor at the Bureau of
Reclamation.
Mr. Quint.
STATEMENT OF ROBERT QUINT, SENIOR ADVISOR, BUREAU OF
RECLAMATION, DEPARTMENT OF THE INTERIOR
Mr. Quint. Thank you, Chairman Schatz and members of the
subcommittee. I'm Bob Quint, Senior Advisor at the Bureau of
Reclamation. Thank you for the opportunity to testify on 7 of
the bills before the subcommittee today.
I also ask for your consent to submit a Departmental
statement for the record on Senate Joint Resolution 12 which
consents to and approves certain technical amendments proposed
by the State of Hawaii to the Hawaiian Homes Commission Act of
1920.
Due to the number of Reclamation bills on the agenda I will
keep my verbal remarks as short as possible and my full written
statements have been submitted for the record.
Let me start with S. 211, Provo River Project Transfer Act.
S. 211 provides a technical correction to the earlier enacted
Provo River Project Transfer Act, now Public Law 108-382. Our
agency supported passage of that earlier titled transfer
legislation in 2004.
My written statement provides more detail in the events
that have transpired since its enactment. But in summary S. 211
addresses the fact that the Provo Canal was converted into a
pipeline after the title transfer was enacted and the strict
language of the original title transfer did not allow for that.
Reclamation and our partners should have foreseen that
possibility before the work proceeded, but for reasons
described in my written statement, we did not.
We are pleased to support S. 211 to settle the issue and
fully complete the transfer originally envisioned in 2004.
Next, S. 284, Fort Sumner Project Transfer Conveyance Act.
S. 284 provides for the title transfer of the Fort Sumner
Project in New Mexico as well as a long term provision of water
for fish flows on the Pecos River.
In June of last year the United States and the Fort Sumner
Irrigation District executed a MOA culminating a collaborative
process to bring about conveyance of title to the Fort Sumner
Project in the remaining steps required of the Federal and non
Federal parties. The MOA will facilitate an arrangement between
FSID and the U.S. Fish and Wildlife Service for actions under
Section 10 of the Endangered Species Act to be finalized prior
to the transfer which will protect habitat of the federally
listed Pecos River bluntnose shiner.
My written statement provides more detail. But in summary,
the Department is also pleased to support S. 284.
Next, S. 510, Scofield Land Transfer Act. S. 510 conveys
interest in certain lands associated with the Reclamation
Scofield project in Carbon County, Utah.
In the 1950s individuals began locating structures on flood
surcharge lands at Scofield Reservoir without Reclamation
concurrence. These encroachments pose a dam safety issue
because a flood event may float debris or structures into the
spillway and threaten the dam. S. 510 proposes to resolve these
encroachments on Federal lands by authorizing Reclamation to
transfer a fee interest or life estate to those who claim
ownership of the United States? lands within the Scofield
Reservoir Basin in exchange for fair market value. Structures
would also be required to be anchored to foundations to prevent
displacement during flood events and therefore reduce the
potential for compromising the dam causing harm downstream.
My written statement addresses the provisions more
specifically and proposes some technical clarifications of the
bill.
In summary, the Department does not oppose S. 510 with the
improvements recommended in my written statement.
Next is S. 659, the Emergency Drought Relief
Reauthorization. S. 659 would reauthorize the Reclamation's
State's Emergency Drought Relief Act.
While my written statement details how planning and
conservation are the most effective means of addressing drought
we, none the less, recognize that the authorization of Title I
of the Drought Act as a useful tool in responding to drought
emergencies. S. 659 allows Reclamation the flexibility to
continue delivering water to meet authorized project purposes,
meet environmental requirements, respect State water rights,
work with all stakeholders and provide assistance.
We are pleased to support S. 659.
Next is S. 684, the Mni Wiconi Project Act Amendments. S.
684 would amend the original Mni Wiconi Project Authorization
with additional project features and obligations for new
Federal appropriations.
The Mni Wiconi Project will be substantially complete with
the allocation of appropriations provided in the current Fiscal
Year 2013 budget. We recognize that this legislation has been
significantly revised since Reclamation last testified it in
2012. However as stated in testimony on the prior legislation
Reclamation has a significant backlog of authorized but not
constructed rural water projects. Therefore we continue to have
serious concerns about adding to the scope of an existing
project that is nearly complete.
For reasons described in my written statement mainly driven
by the serious budget situation confronting Reclamation and all
Federal agencies, the Department cannot support S. 684.
Next is S. 693, Hermiston Title XVI. S. 693 would authorize
Reclamation to co-fund a water recycling and reuse plant in the
city of Hermiston, Oregon.
Working together the city and Reclamation have completed
specific actions that are necessary for the proposed project.
This includes environmental compliance, issuance of the license
to the city, granting authorization to construct and operate a
facility on Reclamation Fee Title land and issuance of a permit
allowing this water to be discharged into Reclamation's West
Main Canal.
However, for reasons described in my written statement
standing policy is we do not support new authorizations while
that backlog remains as high as it is.
Next is S. 715, Rural Water Project Completion Act. The
Department testified on a prior version of S. 715 in July 2012.
Our position remains the same on S. 715. We support the goals
of the bill and recognize the benefits of the potential
dedicated rural water construction fund in the United States
Treasury which would enable earlier completion of projects.
Section 3B3 of S. 715 provides that the bill's cost would
be offset so as not to increase the deficit. The Department
supports such language.
Finally, Senate Joint Resolution 12 amends the Hawaiian
Homes Commission Act to allow the interest rate on loans from
the Hawaiian Home Loan Fund and the Hawaiian Home Loan Fund to
be set by the Hawaiian Homes Commission through an
administrative rule rather than by law. Senate Joint Resolution
12 also changes the qualifications of homestead leasees by
authorizing a Hawaiian Homes Commission Act Homestead leasee to
transfer or designate to a successor to their leasehold
interest to a brother or sister who is at least one quarter
native Hawaiian.
The Department supports the United States consenting to and
approving of Act 107 and remains neutral on the consenting to
and approval of Acts 12 and 16.
I'd be happy to follow up with the Department regarding any
questions you may have.
That concludes my verbal remarks. I'd be pleased to answer
any questions you may have.
[The prepared statements of Mr. Quint follow:]
Prepared Statements of Robert Quint, Senior Advisor, Bureau of
Reclamation, Department of the Interior
ON S. 211
Chairman Schatz and Members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to present the views of the Department of the Interior (Department)
regarding S. 211, an amendment to the Provo River Project Transfer Act
(Act) authorizing the Secretary of the Interior (Secretary) to convey
the recently-enclosed Provo Reservoir Canal to the Provo River Water
Users Association (Association). The Department supports S. 211.
A principal feature of the Provo River Project is the Provo
Reservoir Canal (canal). It extends 22 miles from the mouth of Provo
Canyon to Salt Lake County. Once it meandered through pastures and
fields. By the late 1990s, suburban development had surrounded it.
During this time, the Association concluded that owning the canal and
associated project features would facilitate its ability to obtain
financing for its eventual enclosure of the canal. Enclosing the canal
into pipe offered significant potential new benefits in terms of water
conservation, water quality, in stream flows, public safety and
upstream recreation.
In 2004, Congress agreed that transfer of the Provo River Project
was in the public interest. The Provo River Project Transfer Act
(Public Law 108-382) was enacted, authorizing the transfer to the
Association of the Provo Reservoir Canal and the site of the
Association's Office. It further authorized the transfer of the Salt
Lake Aqueduct to the Metropolitan Water District of Salt Lake and
Sandy. The Department supports transferring ownership of certain
Reclamation project facilities to non-Federal entities in cases where
transfers create benefits for those who take title as well as for other
stakeholders and the public. For this reason, the Department supported
passage of the Act in 2004.
In the years since enactment of the Act, Reclamation has conveyed
the Salt Lake Aqueduct to the Metropolitan Water District of Salt Lake
and Sandy. One of the requirements of the Act was that all of the water
users--including the Association, the Central Utah Water Conservancy
District, the Metropolitan District of Salt Lake and Sandy and the
Jordan Valley Water Conservancy District needed to develop a
comprehensive agreement to govern the operations, ownership financing
and improvement of the PRC (Section 3.a.1B of the Act). Consequently,
following its enactment, the parties began meeting regularly to discuss
and negotiate the Master Agreement. From late 2004 through mid-2009,
all of the parties acted on the belief that, after the parties reached
agreement as required in the Act, Reclamation would transfer title and,
after transfer, the Association would begin the piping of the PRC.
However, in May of 2009, the Association determined that the approach
being considered for title transfer, funding, and enclosure placed the
Association's tax-exempt status in jeopardy and threatened the entire
project.
In response, an alternative strategy for the canal portion of the
transfer was developed by the parties, whereby the Association, the
partners and Reclamation proceeded with piping the canal under
Reclamation's operation, maintenance, and replacement authority in
2009. Today, crews are constructing a recreation trail on the surface
of the ground over the piped Provo Reservoir Canal. Below the surface,
a 10.5-foot-diameter pipe continues to convey Provo River Project
water.
Unfortunately, the parties, including Reclamation, moved forward
with the title-transfer-after-piping option without realizing that this
sequence was out of compliance with the original statutory authority to
transfer the Provo Reservoir Canal to the Association ``as in existence
on the date of enactment[.]''. In retrospect, we all should have more
carefully considered the potential effects of this change in the title
transfer/construction sequence on title transfer as provided for in the
Act. That brings us to the need for the technical amendments provided
by S. 211. This technical amendment alters the definition of the Provo
Reservoir Canal to authorize the transfer of the pipeline as well as to
eliminate any confusion about the facilities to be transferred. The
amendment authorizes transfer of the newly constructed pipeline by
removing the term ``canal'' in the definition and replacing it with
``water conveyance facility historically known as the Provo Reservoir
Canal'', and by eliminating the phrase ``as in existence on the date of
enactment of this Act.'' The bill also directs the transfer of ``all
associated bridges, fixtures, structures, facilities, lands, interests
in land, and rights-of-way held'', which Reclamation also supports
since appurtenant facilities are currently used by the Association.
The majority of the $150 million cost of piping the canal was born
by the Association, the Central Utah Water Conservancy District, the
Jordan Valley Water Conservancy District, and the Provo Reservoir Water
Users Company. Federal funding applied to the project was $39 million
provided by the Central Utah Project Completion Act Office. This
amount, provided under the water conservation provisions of the Central
Utah Project Completion Act, ensured that 8,000 acre-feet of conserved
water would be made available to the Secretary to provide in-stream
flows on the lower Provo River. These flows benefit fish and wildlife
including the endangered June sucker, a species native only to Utah
Lake and its tributary streams. Reclamation provided no funding to the
piping project.
As a condition of title transfer, the 2004 Act (PL 108-382)
requires the Association to remit to the United States its repayment
obligation associated with the canal--the amount it continues to owe
Reclamation for reimbursement of the original costs of construction.
This obligation does not change under the technical amendment proposed
by S. 211.
Reclamation sees the issue being addressed by S. 211 as purely
technical. Concurrent to consideration of S. 211, Reclamation, the
Association and the other partners continue to move ahead to complete
all the other steps necessary to transfer title and believe that with
passage of this bill, we will be able to move forward expeditiously to
finalize this title transfer. We continue to support the title transfer
and the excellent work that has gone on with the enclosure of the
canal.
This concludes my written statement. I would be pleased to answer
questions at the appropriate time.
ON S. 284
Chairman Schatz and members of the Subcommittee, I am Robert Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to provide the views of the Department of the Interior (Department)
regarding S. 284, 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). The Department supports S. 284.
In 2011, S. 1225 was introduced in the 112th Congress, which would
have authorized the United States to convey title to all of the works
of the Fort Sumner Project to the FSID. At the time of the hearing on
June 23, 2011 before this Committee on that bill, it was the view of
the Administration that a number of issues had yet to be resolved
between the United States and FSID, including a net financial loss to
the Treasury of approximately $250,000, the need for an open and
transparent process for the public to provide input prior to conveyance
of title, and the need for Reclamation and FSID to work through a
collaborative process to ensure that operational, fiscal,
environmental, and other issues are identified and addressed. However,
since that time, Reclamation and FSID have worked together and a number
of those issues are addressed in S. 284. Specifically, in 2012, the
``Memorandum of Agreement between the United States and the Fort Sumner
Irrigation District Concerning Principles and Elements of Proposed
Transfer of Title to Fort Sumner Irrigation District'' (MOA) was
executed, which addresses the issues we had with the previous
legislation as described below.
BACKGROUND
There are two Reclamation projects on the Pecos River located in
southeastern New Mexico: the Carlsbad and Fort Sumner Projects. The
Fort Sumner Project was developed by private interests at the turn of
the last century. In the 1950s, this project was reconstructed and
rehabilitated by Reclamation. In 1948, in order to make this happen,
Reclamation and the FSID executed a contract to provide for the
repayment of construction costs to rehabilitate the project. As part of
the process, Reclamation law required that Reclamation take title to
the Project. Currently, the FSID has an annual repayment obligation of
about $54,500 with an outstanding balance of approximately $597,697.00
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 maintain the shiner population level by
minimizing river drying. 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 its 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 both the passage of
title transfer legislation and the conveyance of title. 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 in a cost
effective manner.
As drafted, S. 284 protects the financial interests of the
taxpayers of the United States. Under the terms of the Forbearance
Agreement that is currently in place, Reclamation pays FSID $60,000
annually plus $20 per acre-foot for water. Under the terms of S. 284,
after title transfer, the $60,000 annual payments from the United
States to FSID would cease. At the same time, FSID's repayment
obligation of $597,697 to the United States would also cease. These two
revenue streams--one to FSID and one to the United States would offset.
Further, the United States would continue to receive, in perpetuity
rather than just for the ten years, the below-market-cost of $20 per
acre-foot for up to 2,500 acre feet of water annually that they need in
order to meet the 2006 biological opinion--thereby saving the taxpayers
in costs associated with this important water acquisition effort.
MEMORANDUM OF AGREEMENT
On June 22, 2012, the United States and FSID executed MOA, numbered
11-WC-40-406. This agreement was the culmination of a collaborative
process between Reclamation and the FSID which articulated the
principles elements for any legislation to authorize conveyance of
title to the works of the Fort Sumner Project, as well as the steps
required to complete the title transfer process, the responsible
parties for each activity and spelled out the prerequisites to the
actual conveyance of title to FSID.
The MOA takes an important step in resolving our concern regarding
compliance with Federal and state laws--more specifically--with the
terms of agreement to be developed between FSID and the U.S. Fish and
Wildlife Service required under Section 10 of the Endangered Species
Act. While it would be our preference to complete all of the activities
required under the National Environmental Policy Act, the National
Historic Preservation Act and the Endangered Species Act prior to
acting upon legislation to transfer title, as a compromise, S. 284
requires that all the activities associated with these laws, including
whatever mitigation may be necessary be completed prior to the transfer
of title to these facilities. As part of that, before the conveyance of
title, Reclamation must concur with the ESA Section 10 agreement thus
ensuring that the United States' interests are not compromised.
Because S. 284 requires National Environmental Policy Act
compliance and completion of ESA Section 7 and Section 10 consultations
as prerequisites to conveyance of title, Reclamation and FSID will have
the opportunity to complete a public process to determine whether other
interested citizens of New Mexico have concerns and any issues that
arise during that public process can be collaboratively be addressed in
the title transfer agreement that must be prepared to articulate the
terms and conditions of the title transfer as defined in Section 2(7)
of the Act.
S. 284 also authorizes Reclamation to cost-share with FSID for both
environmental compliance as well as the cost of conveyance of title.
Lastly, Reclamation believes that S. 284 would assure the
continuation of the partnership Reclamation has developed with FSID in
meeting the 2006 Biological Opinion requirements. With the challenges
of persistent drought in the Pecos River basin and the need for
Reclamation to consult, in partnership with FSID and the Carlsbad
Irrigation District, with the Service in obtaining a new biological
opinion by 2016, this title transfer legislation will enable us to meet
this critical objective.
As a result of the efforts, hard work and compromises by both
Reclamation and FSID, we believe that we have reached an agreement that
protects the interests of FSID, the citizens of the States of New
Mexico and the interests of the United States.
That concludes my written statement. I am pleased to answer
questions at the appropriate time.
ON S. 510
Chairman Schatz and members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). Thank you
for the opportunity to provide the Department of the Interior's views
on S. 510, legislation to authorize the Secretary of the Interior to
convey certain interests in Federal lands acquired for the Scofield
Project in Carbon County, Utah. The intent of the legislation is to
resolve certain issues associated with decades-long encroachment on
Federal lands in the Scofield Reservoir basin while maintaining the
safety of the public downstream. If the revisions described below are
made, the Department would not oppose an amended S. 510.
The Scofield Project is located on the Price River about 85 miles
southeast of Salt Lake City, Utah. It provides irrigation and municipal
and industrial water to Carbon County, Utah. The reservoir is a popular
fishing destination. Under contract with Reclamation, the State of Utah
operates a state park at the site.
At Scofield Reservoir, the vertical distance between the normal
water surface elevation of the reservoir and the flood surcharge
elevation (the level to which the water level may rise in a flood
event) is approximately 19 feet. Given the sloping sides of the
reservoir basin, this flood surcharge capacity translates into a wide
band of land around the perimeter of the reservoir above the normal
water surface elevation and below the flood surcharge elevation. The
United States owns in fee most of the lands within this band. In a
flood event, water would inundate these lands. It is Reclamation's
practice to keep these lands free of structures and chattel that, in a
flood event, might be floated into the spillway.
In the 1950s, an individual purported to subdivide and sell some of
these flood surcharge lands--in spite of United States' ownership. The
purported ``owners'' (referred to in the Scofield Land Transfer Act as
``claimants'') began locating mobile homes and building cabins on these
lands. There are over sixty encroaching cabins and trailers today.
These encroachments pose a dam safety issue because a flood event may
float debris or structures into the spillway, creating a logjam that
would reduce the spillway's capacity and threaten the dam. The sudden
collapse of such a logjam would create a wall of water, scouring the
canyon below the dam and flooding the downstream communities of Helper,
Price, and Wellington. Reclamation recently completed an assessment on
the risk imposed by this scenario entitled, Scofield Dam--Report of
Findings Risk Analysis Considerations for Reservoir Surcharge (January
2013). This assessment revealed that should a logjam of structures and
chattel in the spillway suddenly give way, it would release a flood
downstream of up to 8,000 cubic feet per second, which is 40 to 50
times the normal expected flow in the Price River below Scofield Dam.
In 2000, Reclamation initiated a quiet title action on lands within
the band on the east side of Scofield Reservoir and was joined in that
action by 15 claimants. A 2009 decision by the Tenth Circuit Court of
Appeals affirmed ownership by the United States. Reclamation has
removed the encroachments on the lands that were the subject of the
quiet title action. Because of similar underlying facts, quiet title
actions associated with the remaining encroachments would likely affirm
United States' ownership.
The bill proposes to resolve these encroachments on Federal lands
by authorizing the Secretary of the Interior to transfer a fee interest
or life estate to those who claim ownership of United States' lands
within the Scofield Reservoir basin in exchange for fair market value.
Claimants have a period of five years during which they may seek a fee
interest or life estate. If a claimant does not elect to acquire a fee
interest or life estate, Reclamation will remove the encroachment under
existing law and policy, including the removal of encroaching
structures.
Although the bill addresses in part key objectives for Reclamation,
the ideal scenario for Reclamation is for no structures or dwellings to
fall within a facility's flood surcharge elevation. Having said that,
the bill does address concerns such as improved protection of public
safety and resolving certain issues of encroachment on United States'
lands. In addition, the bill imposes conditions on transferred lands.
First, it limits the number and types of structures to those in place
on the date of enactment. Second, it requires that structures be
anchored to foundations to prevent displacement during a flood event
and thereby reduce the potential for clogging the spillway,
compromising the dam, and causing harm downstream. Third, it requires
Reclamation to retain the ability to store flood flows on the
transferred lands without liability to the United States.
While Reclamation supports, in general, some specific provisions in
the bill, the legislation perpetuates occupancy within the flood
surcharge elevation, which poses public and dam safety concerns. In
addition, the bill's language raises a number of technical concerns:
Cost of Implementation--The proposed legislation does not
provide any monies to fund Reclamation's work in surveying,
appraising, and transferring fee interest or life estates to
claimants. The legislation furthermore does not provide any
monies to conduct environmental compliance, provide notice to
claimants of existing trespasses or encroachments on Federal
lands, or enforce deed restrictions. These costs should not be
absorbed by the Federal Government.
Cost of Administration--After the legislation is fully
implemented, Reclamation will likely face a patchwork of
ownership (private fee interest, private life estates,
Reclamation fee interest, and Reclamation flood easements) at
the reservoir in the band between the normal water surface
elevation and the flood surcharge elevation. On the transferred
lands, Reclamation will be required to monitor construction and
the retrofitting of structures to ensure that they are properly
secured. In addition, Reclamation will be required to preserve
public access to Reclamation fee lands that are not encumbered
by life estates. The administration costs and enforcement
obligations pursuant to any conveyance restrictions are best
left to the local government, subject to oversight by
Reclamation.
Scofield Reservoir Fund--The proposed legislation calls for
revenues from the sale of fee interests and the sale of life
estates to be deposited into a ``Scofield Reservoir Fund.'' The
fund would be used to finance ``enhanced recreation
opportunities at Scofield Reservoir.'' The Department of the
Interior has serious concerns about the establishment and use
of the Scofield Reservoir Fund because of the costs associated
with administering a small and narrowly focused fund. Also, the
fund could better be used to defray administration and
enforcement costs associated with these lands rather than being
directed toward the beneficiaries of the conveyance.
Precedent--On one level, the proposed legislation amounts to
rewarding encroachment with an opportunity to purchase or
acquire private exclusive use of Federal lands. The Department
of the Interior is concerned about the bill setting a precedent
or expectation that there can be a path from encroachment to
ownership; however, the Department also finds merit in amicably
resolving encroachment issues on the Scofield Reservoir without
embarking on protracted litigation.
Report to Congress--Reclamation believes the bill's
objectives can be accomplished consistent with Congressional
intent and with support from the local community. Because of
the proliferation of required reports to Congress, and the
demand on finite budget resources, the Department in general
does not support new and narrow reporting requirements.
In addition to those issues raised above, Reclamation has a number
of technical concerns:
Land Disputes--Among claimants there are disputes about the
boundaries of their claims. The resolution of these claims
would likely erode the five years that the claimants have to
decide whether to submit notice of a desire to acquire a fee
interest or life estate. The legislation should direct
claimants to accept the result of the Reclamation survey
required under Section (3)(a)(1).
Hold Harmless Clause--The life estate option requires the
claimant to hold the United States harmless for damages due to
``design, construction, operation and replacement.'' The list
of causes from which damages may arise should also include
``maintenance.'' In addition, there is no requirement for
claimants seeking fee interest in claimed land to hold the
United States harmless. Reclamation recommends that a hold
harmless requirement be added to the fee interest option.
Payments in Lieu of Taxes (PILT)--The proposed legislation
should explicitly state that PILT payments will be discontinued
for lands transferred in fee to claimants.
Mineral Rights--The proposed legislation should state that
there will be no conveyance of subsurface or mineral rights.
Water Rights and Sewer System A number of the claimants have
developed wells that are also part of their encroachment. To
the extent these wells are supported by valid State of Utah
water rights, the legislation should address the fate of these
wells under conveyance in fee or life estate. The sewer system
serving encroachments is included in a Reclamation license
agreement for the State Park. The license agreement is with the
Scofield Special Service District for which Carbon County has
oversight responsibility.
Sunset--The proposed legislation requires claimants to submit
notification to the Secretary of their interest in a fee
interest or life estate in the claimed portion of the Federal
land within five years of the date of enactment of the proposed
legislation, in order to stay enforcement proceedings on the
Federal land. This could allow claimants to submit notice of
their intent to receive a fee interest or life estate, without
requiring the claimants to take any affirmative steps to
effectuate the transfer. The proposed legislation should
contain a sunset provision whereby notice and transfer must
occur within a reasonable timetable.
In closing, Reclamation recognizes that, in spite of its serious
concerns, the proposed legislation does offer an acceptable five-year
solution to a problem Reclamation has wrestled with for many years. In
light of this, the Department of the Interior will not oppose S. 510 if
appropriate clarifying language and revisions are added.
That concludes my statement. I am pleased to answer questions at
the appropriate time.
ON S. 659
Chairman Schatz and Members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to provide the views of the Department of the Interior on S. 659 which
reauthorizes Title I of the Reclamation States Emergency Drought Relief
Act of 1991 until the year 2018, and increases the amount of authorized
federal appropriations from the current ceiling of $90 million up to
$110 million. The Department supports extending the authorization of
this program through 2018; however, as explained below, we do not
believe an increase to the authorization of appropriations is necessary
at this time. An April 3rd update to the U.S. Drought Monitor shows
that 83% of the Western United States, where Reclamation operates, is
abnormally dry, with 63% being in moderate to exceptional drought
status.
Title I of the Reclamation States Emergency Drought Relief Act of
1991 provides Reclamation the authority for construction, management,
and conservation measures to alleviate the adverse impacts of drought,
including mitigation of fish and wildlife impacts. This authority is
most often implemented through drilling new private wells. Wells are
the only permanent construction authorized under the Act. All other
Title I work must be of a temporary nature. No new Reclamation projects
are authorized under Title I; Reclamation does not own, operate, or
maintain projects funded under it. S. 659 would extend the expiration
date as well as increase the authorization for appropriations from $90
million to $110 million to allow for greater capacity in Reclamation's
assistance to States, tribes, and local governments in addressing the
impacts of drought.
Title I also provides Reclamation with the flexibility to meet
contractual water deliveries by allowing acquisition of water to meet
requirements under the Endangered Species Act, benefiting contractors
at a time when they are financially challenged. We believe that our
existing WaterSMART Program provides some lessons applicable to the
communities where Drought Act authorities are used.
Additionally, Title I authorizes Reclamation to participate in
water banks established under state law; facilitate water acquisitions
between willing buyers and willing sellers; acquire conserved water for
use under temporary contracts; make facilities available for storage
and conveyance of project and nonproject water; make project and
nonproject water available for nonproject uses; and, acquire water for
fish and wildlife purposes on a nonreimbursable basis.
Reclamation's primary approach to drought is to continue working
with our stakeholders on a proactive basis to assess the implications
of water shortages, develop flexible operational plans that account for
expected periods of drought, and support projects that conserve water
and improve the efficiency of water delivery infrastructure. Federal
Drought relief is a ``last resort'' to be employed only in the most
extreme of cases. Given the extreme weather conditions currently facing
the nation, we will continue to consider ideas to make drought relief
even more effective through improved interagency cooperation and other
changes.
Title II of the Reclamation States Emergency Drought Relief Act of
1991 provides Reclamation with permanent authority to assist States,
Tribes, and local governments with planning and technical assistance
related to drought planning, preparation, and adaptation strategies.
This authority allows Reclamation to assist non-Federal entities to
prepare for drought so that they are less vulnerable when drought
inevitably happens. This authority for drought-related Federal
coordination and technical assistance does not automatically expire and
will remain in effect without the authorities that S. 659 would extend.
Given that there remains a capacity for over $15 million in
authorized appropriations for this program, the Department does not
believe an increase in the authorized appropriations ceiling is
necessary at this time. If the authorized appropriations ceiling should
become a more urgent constraint, we will evaluate the need for an
increase to the appropriations ceiling at that time.
This concludes my written statement. I am pleased to answer
questions at the appropriate time.
ON S. 684
Chairman Schatz and members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to provide the views of the Department of the Interior (Department) on
S. 684, the Mni Wiconi Project Act Amendments of 2013. The Department
recognizes that meaningful changes to this bill have been made since
prior related legislation was heard during the 112th Congress. However,
if enacted, this updated version of the bill would still expand the
scope and authorization ceiling of the Mni Wiconi Rural Water Supply
Project, and have significant impacts on the budgets of both
Reclamation and the Bureau of Indian Affairs. For the reasons described
below, the Department cannot support S. 684.
The Mni Wiconi Rural Water Supply Project is a municipal, rural and
industrial project that serves both tribal and non-tribal populations
of the Pine Ridge, Rosebud, and Lower Brule Indian Reservations and the
West River Lyman-Jones Rural Water System in seven counties of
southwestern South Dakota. Responsibilities of the Secretary under the
Mni Wiconi Rural Project Act (Public Law 100-516) include the operation
and maintenance of existing water systems, including the core treatment
plant and pipelines, and appurtenant facilities on the Pine Ridge,
Rosebud and Lower Brule Indian Reservations. With the funding requested
in the President's FY 2013 budget, the majority of the population of
the project will be served. The Lower Brule and West River Lyman-Jones
portions of the project will be completed. Generally those not
connected to the project (approximately 2.5% of the population on
Rosebud and Pine Ridge Reservation) are served by community water
systems or individual wells. Reclamation would be happy to facilitate
or coordinate action with other federal agencies to address the needs
identified by the bill's sponsor. Reclamation has a backlog of
authorized but not constructed projects. Therefore, we have concerns
about adding to the scope of an existing project that is nearly
complete.
Section 2 of S. 684 directs the Secretary of the Interior to
develop a plan for completion of the Oglala Sioux Rural Water Supply
System, the Rosebud Sioux Rural Water Supply System, and the Lower
Brule Sioux Rural Water System. Planning the completion of the systems
is dependent on future appropriations as well as Reclamation's need for
flexibility in decision-making relative to all authorized rural water
projects. Reclamation must constantly assess and prioritize these kinds
of projects to maximize the agency's ability to meet its programmatic
goals, to maximize water deliveries to rural communities as efficiently
as possible, and to reflect the diverse needs and circumstances facing
each individual project. The Department would like to work with project
sponsors of the bill to discuss plans for completion, and clarifying
the roles, responsibilities, and authorities of Federal agencies
involved in the project. An interagency agreement, as proposed by
Reclamation during the August 8, 2012 Joint Consultation Meeting with
Federal Agencies, has the potential to achieve many of these
objectives. Further, Reclamation is continuing to evaluate the facility
improvements needed to transfer and incorporate existing community
water systems.
Section 2 also directs the Director of the Bureau of Indian
Affairs, through the use of existing programs and annual
appropriations, to assist the Secretary in completing the Oglala Sioux
Rural Water Supply System, the Rosebud Sioux Rural Water System, and
the Lower Brule Sioux Rural Water System by constructing, repairing,
and upgrading plumbing fixtures, skirting, and other necessary
features, such as septic tanks and drainfields, to ensure that houses
within the service areas are able to meet the standards for connecting
to those systems. The Bureau of Indian Affairs has no existing programs
or annual appropriations for the construction, repair, or upgrading of
plumbing fixtures or septic systems on private residence. Such function
has usually been the responsibility of Health and Human Service or
Indian Health Service.
Section 3(a) of S. 684 would increase the authorized Mni Wiconi
cost ceiling by an additional $14,308,000, based on October 1, 2011,
price levels. Reclamation has worked closely with the project sponsors
to ensure completed features will be functional and provide intended
benefits within the currently authorized cost ceiling. The Department
continues to believe that the FY 2013 President's request of $23
million for construction provides sufficient funding to meet the
objectives of the Project as authorized. Recently enacted final
appropriations for FY 2013 will determine final allocations to the
project. In FY 2014, the Department is continuing to meet its longer-
term obligation to fund operations and maintenance for the Mni Wiconi
project's Indian sponsors features through Reclamation's request for
$12 million in new FY 2014 appropriations.
Section 3(b)(5) would transfer existing public or tribal water
systems ``in trust to the applicable rural water system'' upon requests
from the Tribes or owner of such system. This language leaves some
uncertainty in ownership as it doesn't identify the nature of the
``trust''. Language in sections 3A(e) and 3B(e) of the current Act
identifies that ownership is to be held in trust for the tribe by the
United States. Section 3(b) also authorizes appropriations for
operation and maintenance to be used for the improvement, repair, and
replacement of existing public or tribal water systems prior to and
after their transfer into the respective project system. Reclamation
had previously determined that the costs of upgrading existing
community facilities should be properly allocated to the construction
component of the project. Since these existing systems were originally
constructed using funds and authorities of other agencies, Reclamation
believes any funding for improvements needed to correct deficiencies in
existing systems should be discussed among the various responsible
agencies before those systems are accepted into the project.
This concludes my written statement. I would be pleased to answer
questions at the appropriate time.
ON S. 693
Chairman Schatz and Members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to provide the views of the Department of the Interior (Department) on
S. 693, the City of Hermiston, Oregon, Water Recycling and Reuse
Project. For reasons I will discuss below, the Department cannot
support the bill.
S. 693 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
approximately 2,000 to 3,000 acre-feet of drought resistant water
supply during the irrigation season. The 2011 total estimated cost for
this project was 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. In 2011,
Reclamation completed the determination of financial capability and
communicated the final approval to the City.
The City and Reclamation's Pacific Northwest Region have completed
Reclamation specific actions that are necessary for implementation of
the proposed project. This includes environmental compliance, issuance
of a license to the City granting authorization to construct, own,
operate, and maintain their facility on Reclamation fee title land, and
issuance of a permit allowing this water to be discharged into
Reclamation's West Main Canal.
S. 693 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
2014 budget request includes funding for the Department's WaterSMART
Program, of which Title XVI is an important element, and the full 2014
request for WaterSMART is $35.4 million.
As part of this total, the Department is requesting $14 million to
fund Title XVI projects selected through competitive funding
opportunity processes 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 2014.
We recognize that water reuse is an essential tool in stretching
the limited water supplies in the West, and I believe the FY 2014
budget request 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 limited budget, the Department
cannot support the authorization of new Title XVI projects or
extensions of existing authorized cost ceilings at the current time.
Federal budget realities, however, should not detract from the fact
that the Hermiston Recycling and Reuse Project would prove valuable in
Oregon's efforts to address current and future water resource
challenges posed by drought and the competing demand for scarce water
resources.
This concludes my written statement. I am pleased to answer any
questions at the appropriate time.
ON S. 715
Chairman Schatz and Members of the Subcommittee, I am Bob Quint,
Senior Advisor at the Bureau of Reclamation (Reclamation). I am pleased
to be here to provide the views of the Department of the Interior
(Department) on S. 715, the ``Authorized Rural Water Projects
Completion Act''. My statement today will draw upon the testimony
provided by Commissioner Mike Connor in July 2012 on S. 3385, prior
legislation discussed in this Committee during the 112th Congress.
Like the sponsors of this legislation, the Department supports the
goals of encouraging vibrant rural economies and ensuring safe,
reliable sources of drinking water for rural residents. Rural water
projects help build strong, secure rural communities and are important
to our non-federal sponsors, which is why the President's FY 2014
Budget includes $40 million for rural water projects.
As a threshold matter, the Obama Administration has supported
Reclamation's rural water program over the last four years, allocating
$231 million of funding, in the FY 2010-2013 budgets, to construct,
operate, and maintain authorized rural water projects in addition to
$232 million provided for these projects in the Recovery Act. Still,
the rural water program must compete with a number of other priorities
within the Budget, including aging infrastructure, Indian water rights
settlements, environmental compliance and restoration actions, and
other priorities intended to address future water and energy related
challenges. Notwithstanding the importance of rural water projects,
current budget constraints have limited the ability to make Federal
investments that match on-the-ground capabilities.
Despite such constraints Reclamation has made progress in promoting
certainty, sustainability, and resiliency for those who use and rely on
water resources in the West and in supporting the basic drinking water
needs of rural communities, as directed by the Congress. S. 715
provides a constant level of mandatory funding to support the
construction of authorized rural water projects to deliver water to
smaller, isolated communities. However, the Department believes Federal
investments in such projects must recognize the current fiscal
constraints and the need to make tough choices in prioritizing those
investments. The Administration supports the goals embodied by S. 715
of advancing the economic security of Americans living in rural areas,
and constructing these important infrastructure projects will not only
help provide the economic benefits of a clean, reliable, drinking water
system that most Americans take for granted, but will also assist in
creating jobs in the short-term through ongoing construction, but the
Administration supports discretionary funding for these projects.
Since the 1980s, Congress has authorized Reclamation to undertake
the design and construction of specific projects intended to deliver
potable water supplies to rural communities located in North Dakota,
South Dakota, Montana, New Mexico, Minnesota and Iowa. These projects
exist in communities that are experiencing urgent needs for water due
to poor quality of the existing supply or the lack of a secure,
reliable supply. For example, in rural Montana, some communities have,
from time-to-time, been subject to ``boil water'' orders due to the
unsafe conditions of the existing drinking water supplies. In Eastern
New Mexico, the existing communities currently rely on the diminishing
Ogallala Aquifer and the current drinking water systems are projected
to be depleted within 40 years. Reclamation's Rural Water Program
provides a resource to rural communities under those circumstances and
the Congress has authorized federal assistance to meet those needs.
The Rural Water Supply Act of 2006 (P.L. 109-451) authorized
Reclamation to establish a program to work with rural communities,
including tribes, in the 17 Western States to assess rural water supply
needs and conduct appraisal and feasibility studies without individual
acts of Congress. Pursuant to the Rural Water Supply Act, Reclamation
created a rural water program to enable coordinated examination of the
various options to address rural communities' water supply needs
through a cost effective, priority-based process.
In addition to authorizing appraisal investigations and feasibility
studies, Section 104 of the Rural Water Supply Act required that the
Secretary of the Interior, in consultation with the Secretary of
Agriculture, the Administrator of the Environmental Protection Agency,
the Director of the Indian Health Service, the Secretary of Housing and
Urban Development and the Secretary of the Army, to develop a
comprehensive assessment of the status of the existing, authorized
rural water projects. Section 104 also directs Reclamation to describe
its plans for completing the design and construction of the authorized
rural water projects.
In response to Section 104, Reclamation issued a draft assessment
report titled ``Assessment of Reclamation's Rural Water Activities and
Other Federal Programs that Provide Support on Potable Water Supplies
to Rural Water Communities in the Western United States'' which is
posted on Reclamation's website (www.usbr.gov/ruralwater/docs/Rural-
Water-Assessment-Report-and-Funding-Criteria.pdf). Comments on the
draft report were submitted through September 10, 2012. In addition to
providing a report of the status of the existing authorized rural water
projects, the assessment report describes how Reclamation's Rural Water
Supply Program will be carried out and coordinated with other Federal
programs which support the development and management of water supplies
in rural communities in the western states and to maximize efficiency
of the various programs by leveraging Federal and non-Federal funding
to meet the shared goals of the programs.
As described in the assessment report, with the exception of Title
III of P.L. 107-331 that authorized the Jicarilla rural water supply
system, each of the Acts of Congress authorizing Reclamation's
involvement in the rural water supply projects required that the cost
ceilings included in the original authorizing legislation be indexed to
adjust for inflation which is estimated to be 4% annually. The result
of these indexing requirements is that the overall cost of the
authorized rural water projects has risen and continues to rise during
the time needed for construction, such that the total estimated funding
that would be required to complete these projects is now $2.6 billion,
which is substantially higher than the original authorization amounts,
which totaled $2.0 billion.
Reclamation has recognized the need to make meaningful progress in
constructing authorized rural water projects and has budgeted $40
million in FY2014 toward that effort. At the levels provided in the
2013 budget, and without additional non-Federal funding, progress would
be made towards project completion, but some of the currently
authorized projects would be completed much later, perhaps not until
well after 2063 despite close to $4.0 billion being invested by that
time. It is estimated that as of 2063, an outstanding balance of
approximately $1.1 billion would remain to complete construction of
currently authorized projects.
Across the country, state, local, and Tribal governments are taking
a greater leadership role in water resources investments, including
financing projects the Federal government would have in the past.
Constrained Federal budgets do not preclude the ability of non-Federal
parties to move forward with important investments in water resources
infrastructure and the Department stands ready to support that effort.
Even with the additional resources made available through S. 715, we
would expect that non-Federal entities will likely need to increase
their share of funding to build these projects in the timeframes they
have envisioned.
S. 715 establishes a dedicated Reclamation Rural Water Construction
Fund in the United States Treasury comprised of funds that would
otherwise be deposited into the Reclamation Fund established by the
first section of the Act of June 17, 1902 (32 Stat. 388, chapter 1093).
This funding source would enable earlier completion of projects.
Section 3(b)(3) of S. 3385 provides that the bill's cost would be
offset so as to not increase the deficit. The Department supports such
language. However, even if an equivalent and acceptable offset is
identified, use of those funds must be weighed against other priorities
across the Federal government, including deficit reduction.
Section 3 of S. 715 provides that for each fiscal year from 2014
through 2030, $80,000,000 per year will be deposited into the Fund in
addition to interest earned on invested money that is available in the
Fund but not utilized for the current withdrawal. Section 3(c) of S.
715 limits expenditures from fiscal year 2014 through 2035 from the
Fund to not more than $80,000,000 in addition to interest accrued in
that same fiscal year, with an allowance for the use of funds carried
over from prior years.
S. 715 also provides that if a feasibility study has been submitted
to the Secretary by September 30, 2012, and those projects are
subsequently authorized by Congress, they may be eligible to receive
funding through the Reclamation Rural Water Construction Fund. S. 715
directs the Secretary of the Interior to develop programmatic goals
enabling the expeditious completion of construction of the existing
rural water projects and to establish prioritization criteria for the
distribution of funds. Reclamation's draft assessment report would meet
these requirements when complete. Reclamation's first goal is to
advance the construction of rural water projects that meet the most
urgent water supply needs in the shortest amount of time, given our
current budget constraints. The second goal is to give priority to
rural water projects that address Indian and tribal water supply needs.
Within the context of the above goals, Reclamation recognizes that
current and projected funding levels may not be sufficient to
expeditiously complete the federal funding portion of every project and
that it must prioritize the allocation of available funding. The draft
assessment report outlines prioritization criteria to guide
Reclamation's decision making to maximize the agency's ability to meet
its programmatic goals, to maximize water deliveries to rural
communities in as short a period as possible, and to reflect the
diverse needs and circumstances facing each individual project. The six
criteria identified by Reclamation for rural water construction
prioritization are:
Is there an urgent and compelling need for potable water
supplies?
How close is the Project to being completed and what is the
commitment of the project sponsors to making that happen?
What is the financial need of the communities and what is
the relative economic effect of the Project?
Does the Project fulfill Reclamation's authorized niche for
taking a regional and watershed approach to rural water
projects?
Does the project minimize water and energy consumption and
encourage the development of renewable energy resources such as
wind, solar, hydropower, etc., to meet local needs?
Does the project serve the needs of tribal communities and
tribal members?
The analysis outlined in the draft assessment report underscores
that in times of constrained federal budgets, non-federal funding in
excess of the minimum contributions originally contemplated will be
required to expedite project completion and reduce the effects of
indexing over the construction period.
This concludes my written statement. I am pleased to answer
questions at the appropriate time.
Senator Schatz. Thank you very much, Mr. Quint.
In order to accommodate Chair Baucus' busy schedule, I
think what we'll do is move to Senator Baucus for a statement
regarding rural water projects.
Thank you, Senator Baucus.
STATEMENT OF HON. MAX BAUCUS, U.S. SENATOR
FROM MONTANA
Senator Baucus. Thank you, Mr. Chairman. I also thank very
much other witnesses who are subsequently appearing for letting
me proceed.
I'm here on behalf of something that's really important to
my State. I think the states of most everybody here with the
possible exception of you, Mr. Chairman, and that's water. In
our parts of the country it doesn't rain. Now it rains a little
bit in Hawaii, at least some parts of Hawaii. In other parts it
does not.
But in the Western states, generally, we don't have a lot
of water. West of the 100th meridian it doesn't rain a lot.
That's why we have section lines and grids. It's not leaps and
bounds like the Eastern part of the country.
There's a development of horses and 6 guns and barb wire
and all that driven and caused by the mere simple fact that we
don't have a lot of water, and, you know, horses were necessary
to go great distances because there's no people, because
there's no water. A 6-gun, as developed, is light to carry on a
horse. It's required.
Barbed wire, required. There's nothing like the necessity
to foster invention. We just don't have a lot of water in the
West. We're trying to do what we can based upon that.
This is a support of a bill. It's bipartisan. Senator
Hoeven has joined me in it. It's the Authorized Water Projects
Completion Act. Again I thank Senator Hoeven to make it
bipartisan, also other Senators are a part of this.
As Justice Oliver Wendell Holmes wrote in the early days of
the Bureau of Reclamation and I'll quote him. ``A river is more
than an amenity. It is a treasure. It offers a necessity of
life that must be rationed among those who have power over
it.''
In arid places like Montana we know that water is more than
an amenity. We treasure water because we don't have much of it.
Like so many of us who grew up in our part of the world we are
off the grid. We're off the power grid and we're off the water
grid. We live unconnected to the centralized systems that most
Americans take for granted.
In places like Box Elder and Brockway, my fellow Montanans
have relied too long on old wells that go dry. You know, folks
in communities they just have to have wells. There's no water
system.
They've spent too many years drinking salty water. It's
terrible water, believe me. I've had a good bit of it. It fails
Federal drinking water standards.
This fellow named Bruce Sunchild. He's the chairman of the
Chippewa Cree Tribe. He testified before this committee last
July about all the e-coli in wells on Rocky Boy's Reservation.
That's his reservation. That was in 2011.
Today in Eastern Montana, as the Senator from South Dakota
certainly knows, in Eastern Montana, Western North Dakota the
Bakken oil boom is providing a lot of good jobs. But there's a
problem. It's also challenging small towns that barely meet
their own water standards.
So this bill, I believe, is an overdue step in using the
Reclamation fund for its intended purpose and that is making
the West habitable. The current rate of appropriations from the
fund it will be twice as expensive as it should be to
reconstruct Reclamation projects in states like Montana and the
Dakotas and New Mexico. Investing more water up front will
result in less spending over time.
It was just made that the $40 million for the Reclamation's
rural water projects in the President's budget last week. I
believe it demonstrated once again why Congress needs to act.
We can't rely on the Administration.
My bill will speed up construction, create good paying jobs
and cost taxpayers less money in the long run. This is about
one thing. It's about jobs in rural America. It's about people
who need water.
The bill supports good paying jobs in the near term and
allows rural communities to support businesses in the long
haul. It doesn't add one thin dime to the deficit. I urge you
to consider it favorably.
Thank you, Mr. Chairman.
Senator Schatz. Thank you, Senator Baucus.
Senator Johnson has questions for the testifiers.
Senator Baucus, thank you very much.
Senator Baucus. Thank you.
Senator Schatz. I don't think we'll have any questions for
you.
Senator Baucus. You bet. Thank you.
Senator Schatz. Senator Johnson.
Senator Johnson. Mr. Quint, thank you for being here.
In the authorization statute for Mni Wiconi Congress found
that the U.S. has a trust responsibility to ensure that
adequate and safe water supplies are available to meet the
economic, environmental water supply and public health needs of
the Pine Bridge Indian Reservation, Rosebud Indian Reservation
and Lower Brule Indian Reservation. Incorporating the existing
communities systems into the Mni Wiconi Project is central to
ensuring these needs are met. My understanding is that BOR will
not allow these systems to be incorporated into Mni Wiconi
until they are sufficiently upgraded. Yet BOR has resisted
using funding for upgrades.
Although you testified that the BOR is interested in
working with other agencies I'm not convinced that will happen
outside of legislation. What assurances can you provide that
these needs will be addressed?
Mr. Quint. I want to say that the Department and the Bureau
of Reclamation takes the tribal trust responsibilities very
seriously. As part of taking those seriously we try to work
with the tribes as much as possible to meet the needs that they
have. It's a complicated system.
Many Federal agencies have been involved in building these
systems. Have different levels of responsibilities and funding
for these systems. We're committed to work with all those
entities to try to resolve these issues.
Senator Johnson. Mr. Quint, in last July's report on the
status of rural water projects BOR indicated that with overall
construction funding levels of $50 million annually some of the
authorized projects will extend well beyond 2063 with
substantial outstanding balance remaining. Taking out the
operations and maintenance funding, the FY2014 budget request
for construction on authorized projects is actually down around
$22 million. How would starting with $80 million annually from
Reclamation funding impact project timelines and overall costs
for projects like Lewis and Clark?
Mr. Quint. Let me find my data here.
The current information that I have that with an $80
million annual funding most significant progress can be made
for all the currently authorized projects. We would expect by
the year 2039 that at a total cost of $34 billion we could
finish the currently authorized rural water projects.
Senator Johnson. That is just about a quarter of a century
sooner.
Mr. Quint. That's correct.
Senator Johnson. I yield back.
Senator Schatz. Thank you, Senator Johnson.
Senator Barrasso.
Senator Barrasso. Thank you very much, Mr. Chairman.
Mr. Quint, thanks so much for being here. It's good to see
you.
You know, Mr. Chairman, I believe that developing water for
our rural areas is vital to economic growth in the West. In my
home State of Wyoming I agree completely with Senator Baucus'
comments about water in the Rocky Mountain West, jobs and our
economy. I believe that Senator Baucus' bill, S. 715, the
Authorized Rural Water Projects Completion Act can help achieve
that goal.
I do have some concerns regarding some of the language in
the bill. So I'd like to get some clarification on the
language. I'm more than willing to work with other Senators to
address the concerns.
The first, Mr. Quint, I'd ask you to define what a ``rural
water project'' is supposed to mean with regard to this bill?
Mr. Quint. Our definition of a rural water project is a
project that supplies water for agricultural, municipal and
industrial uses in a rural community.
Senator Barrasso. Because as you know in the 2006 Rural
Water Supply Act that term--they then defined rural water
supply project to not rural water project. I'm just trying to
figure how the Bureau of Reclamation is going to define the
term rural water project because the term really isn't defined
in the bill. That's why I'm just trying to figure out what
projects it would actually cover because we know the specific
words in the bill have a huge impact on some of these things.
I don't know if we need a little----
Mr. Quint. I would rather get back to you with more
specifics for the record.
Senator Barrasso. OK. That's fine. Now on page 3 of the
bill with regard to expenditures from the rural water fund it
says the Secretary may and I emphasize may, expend from the
fund not more than the sum of $80 million.
Section two, page four, it states that the Secretary may
use the amounts from the fund to complete construction of rural
water projects.
So I look at that language and say, does this language give
the Secretary the ability not to spend the money on some of the
authorized rural water projects that qualify for funding or is
this mandatory spending? I'm trying to just get a handle around
that.
Mr. Quint. I, again, I think I'll have to answer that for
the record. I'm not a lawyer. So I don't understand the legal
wills, shalls, mays.
Senator Barrasso. Yes, because it clearly has an impact.
Specifically if this is mandatory spending, but it says it
seems like why are we then giving the Secretary some discretion
in the mays. So if we could get clarification.
Mr. Quint. I appreciate that.
Senator Barrasso. Thank you.
Also with regard to page 3 under the section entitled,
``Limitation.'' It states that, ``no amounts may be deposited
in or made available from the fund under those paragraphs if
the transfer or availability of the amounts would increase the
deficit.''
So I heard Senator Baucus say it wouldn't cost one thin
dime. So I would ask if you could provide us a list of all the
projects. I know you don't have this now--or programs that will
be reduced or revenue accounts that will be increased to make
sure that this bill actually is deficit neutral.
Mr. Quint. We'd be glad to provide that. But I can say that
probably knowing what specific year those projects are it will
be a case by case basis, year by year.
Senator Barrasso. Yes, cause you take a look at this and,
you know, I'm trying to figure out what the differences are and
the different ways that the Secretary can then use this to make
these transfers deficit neutral and if this should maybe be a
formal process to do that.
Another is, I think you're familiar with the GAO report in
February 2006 entitled, ``Indian Irrigation Projects.'' It
continues in the title, under the quote, ``Numerous issues need
to be addressed to improve project management and financial
sustainability.''
I don't know if you're familiar with that project or not.
OK.
I just want to point out that the GAO study says that there
are 16 different irrigation projects initiated, I think, in the
late 1800s, early 1900s by the Department of Interior. They
actually were never completed and/or not sustaining themselves.
All but one of the projects are now managed by the Bureau of
Indian Affairs, but they were previously, you know, through the
Department.
My question is we're looking newer projects and funding
newer projects in this bill when there are many authorized
Bureau of Reclamation projects for tribes that are, you know,
more than 100 years old. I went and visited a number of them
and had a field discussion and forum in Wyoming in a location.
They have severe deferred maintenance backlog, not completed,
but yet we're looking at starting new projects.
So I just wondered if you have some thoughts on that.
Mr. Quint. The only thoughts I have right off the top of my
head, not being aware of the report, is that part of the reason
we've developed some of our criteria for prioritizing projects
is hopes to address those types of issues.
Senator Barrasso. You know, just finally, Mr. Chairman, as
my time is expired. I just want to say that these Indian
irrigation projects need to be addressed, I believe, as part of
this bill so that these tribes can get the assistance that they
need.
So, thank you, Mr. Quint.
Thank you, Mr. Chairman.
Mr. Quint. Thank you.
Senator Schatz. Chairman Wyden.
The Chairman. Thank you very much, Chairman Schatz.
Senator Heinrich, you were here ahead of me. If I took no
more than 3 minutes, could I go because I'm trying to get back
to that other committee you and I share? You want to get there
too.
Senator Heinrich. Absolutely. Go right ahead.
The Chairman. I thank my colleague.
I'm going to be very brief and will submit a couple of
questions for the record as well.
Your hearing today, Mr. Chairman, S. 693, the city of
Hermiston Water Recycling and Reuse Project, this is
extraordinarily important to Hermiston, one of our Eastern
Oregon communities. The City is going to bear the lion's share
of the cost. If we can put it in place as it's presently
constituted, agricultural production will go up.
The local economy will get a boost. It's going to be good
for fish, the environment, and habitat. You are giving the
right expression on your face this afternoon, Mr. Quint, and I
appreciate it.
The other bill is S. 659, the Reclamation State's Emergency
Drought Relief Act Authorization. I think we all understand
what happened last summer with respect to this devastating
drought. The reason that we're going to try to fast-track this
legislation, Mr. Quint, is according to the most recent
information from the Bureau of Reclamation, the Klamath Basin,
which has really been a flash point for this debate, not just
in Oregon, but in the country, has experienced the second
driest January through March period on record.
So you've got those water users in the basin understandably
very worried about the prospect of a very difficult and
treacherous season.
Mr. Chairman, thank you. Glad to see you in that chair's
position as well.
I'll submit some additional questions for the record.
The Chairman. Also, thank my colleague from New Mexico for
his courtesy to be able to get that in very briefly. I yield.
Senator Schatz. Thank you, Chairman.
Senator Franken.
Senator Franken. I would also like to thank the Senator
from New Mexico for his courtesy or for his courtesy, again.
I'm balancing two committees, so by the early bird--you
know what we're doing.
Senator Heinrich. Now just get to your questions.
Senator Franken. Just get to it. Is that what you're
saying?
[Laughter.]
Senator Franken. Now I might take my sweet time.
Mr. Quint, the Authorized Rural Water Projects Completion
Act would spend funds that would otherwise be deposited in the
Reclamation fund. The average annual surplus in the Reclamation
fund from fiscal year 2005 through fiscal year 2011 was $960
million a year. At the end of fiscal year 2011 the fund had
more than $9.6 billion in it.
Now compare that to the $40 million, that's 40 with an m
that your budget would spend on rural water projects next year.
So there is an existing fund that is intended to fund these
projects. It has an astronomical surplus, certainly compared to
what is being budgeted. So I don't understand why this is so
hard.
Why does not the Administration's budget simply request
that we spend the fraction of that surplus that it would take
to get these projects done? I have a project in mind, by the
way.
Mr. Quint. I am sure you do.
Generally we support the concept of that. The issue that
the Administration has and the Department has is that the
mandatory funding requirement from the fund itself takes away
the discretionary part of being able to decide what the
priorities ought to be in each budget year.
Senator Franken. OK. I don't understand. What is the
mandatory funding requirement?
Mr. Quint. The bill basically would require that that be
spent on rural water projects and not, if that wasn't the
highest priority in that particular budget year, that money
would still be spent for those rural water projects as opposed
to that amount being discretionary and put toward other higher
priority projects in a given year.
Senator Franken. Let me talk about a project. This is the
Lewis and Clark Project. Are you familiar with that?
Mr. Quint. Yes, I am.
Senator Franken. Secretary Salazar called it a priority
project. This is a project that starts in South Dakota, in
Southeastern South Dakota. South Dakota basically has all of
its water an hour, almost all of its water.
Minnesota has no water. The local governments have and
Minnesota has paid in its full share. This year's budget
request is $3.2 million which doesn't really even pay for the
inflation on the project. At this rate the thing will never get
done.
Minnesota and the local communities have paid their full
share in this project. Yet, they don't have any. They aren't
getting any water at all.
We have Rock County spent $1.75 million on system
maintenance and upgrades including new wells because the
project isn't finished.
Pipes, Lincoln Pipestone spent $6 million to secure an
interim water supply.
Laverne spent $650,000 on a water reclamation system and a
new well.
We've had economic development projects that have not
gotten done.
This is a quote from chairman of the project, Red Arndt.
``There are no words left but cuss words to describe this
travesty. This leaves us completely dead in the water.''
We made a commitment to these communities that we match
their funding and get them water. After 3 years of extremely
low budget requests my constituents are wondering if the Bureau
of Reclamation wants to keep its commitment. What am I supposed
to tell my constituents? What? Is the Bureau of Reclamation
ignoring the funding commitment that the Federal Government
made?
Mr. Quint. My answer to that is absolutely not. The problem
is that there's a lot more need than there is supply of funds
for the projects. We've come up with a prioritization system to
prioritize projects. We've worked with stakeholders to develop
that process. We apply that for the amount of funding that's
available each year.
Unfortunately every project that's authorized and every
project that is in a similar situation can't be funded because
of the difficult financial situation.
Senator Franken. Last year the request was for $70 million.
This year it's $40 million.
The Mni Wiconi Project has received its funding and it's
done, I guess. So and they received $30 million last year. If
you subtract what they got from last year you get to $40
million.
What happened to the money? I mean, $9.6 billion in the
Reclamation fund. Where is that money going?
Mr. Quint. I'm not an expert on the Reclamation fund. I do
know that that money comes in and then it's used to fund a
number of other projects, not just rural water projects.
Senator Franken. OK. Thank you and the last thing I'm going
to do is go over it now after that stern reproach on my
colleague.
[Laughter.]
Senator Heinrich. You did great once you got started.
Senator Franken. Thank you.
Senator Schatz. Thank you, Senator Franken.
Senator Heinrich.
Senator Heinrich. Thank you very much. I'll apologize to my
colleague here. I want to congratulate you on chairing the
meeting today and for allowing me to sit in on what is not my
subcommittee. So, thank you very much.
Mr. Quint, I wanted to ask you a couple of things.
One, thanks for joining us today, and certainly thank you
for the Bureau's support of the Fort Sumner Title Conveyance
Act and for all the diligent work at the Bureau to finalize
what's really a mutually beneficial agreement with the Fort
Sumner irrigation district. I'm hopeful that this can possibly
serve as a model for other basins that are also home to some of
the drought and endangered species challenges that we face in
the West.
Can you talk a little bit about what lessons we can learn
from this process and how we might implement water forbearance
and leasing in other basins to aid in the recovery of
endangered species? In particular, one of the things that I've
heard a little bit about in recent months is the possibility of
using forbearance as an option in the middle Rio Grande Valleys
as well and get your thoughts on that?
Mr. Quint. We do feel like leasing could be an option for
other commitments in other basins similar to what's going on
here.
Regarding the middle Rio Grande basin my understanding is
that there are some leases that are already being used on a
year to year basis to procure water for some of the ESA needs.
There's also water from Price's Dairy that's being made
available to try to meet some of those needs. We're looking and
working with MRGDC to extend some other leasing arrangements to
try to take care of the issues there.
Senator Heinrich. Great.
I'd love to get a little bit of an update on the status of
that. I appreciate your efforts there.
Mr. Quint. We'd be glad to do that.
Senator Heinrich. As you know Senator Baucus' rural water
project bill has a particular project in New Mexico that's been
in the works for a long time, a very critical project, the
Eastern New Mexico Rural Water System. That would build a
pipeline to provide drinking water to several rural communities
in my State, as well as Cannon Air Force Base. So far
Reclamation has contributed just under $5 million to that
project while the State and local sponsors have spent more than
$26 million getting that off the ground.
The communities in that area are in dire need. It's not
unlike the situation that Senator Franken just described in
terms of the local community really stepping up and putting
their money where their mouth is. The long term situation there
is quite dire.
Portales is expected to run out of ground water in about 10
years. That's not a long time in terms of our planning horizon.
Clovis is projected to run dry in 20 years.
So when you look at the current funding rate the project is
on track to be completed by about the year 2200. That's about
187 years from now. Congress has committed to partnering with
local communities on this project but the slow pace of Federal
funding means that these towns may run out of water long before
the pipeline is ever completed and construction costs, as you
know, go up every single year making it even more challenging.
How can we fulfill our commitment to these communities and
make sure that this project is actually completed in our
lifetime in particular if we don't pass Senator Baucus' bill?
Mr. Quint. My answer is going to sound a little generic,
but we, every project is unique and with the limited amount of
funding we have we have developed a prioritization list to try
to get the money, the most bang for the buck for the projects
that we have in the list. We have a lot more need than we have
resources to put toward them. So we'll continue to work with
the locals and we'll work with them on a year by year basis to
see where they fit in the priority list and get as much money
to all the projects that deserve it that we can.
Senator Heinrich. I'm going to, sort of, reiterate what
Senator Franken touched on because you can prioritize $40
million all day long, but it's still only $40 million. It is,
you know, forgive the pun, but it's a drop in the bucket in
this case. We need to do something to open the tap here.
Mr. Quint. We would love to work with you to come up with
options.
Senator Heinrich. Thank you.
Senator Schatz. Thank you, Senator Heinrich.
Mr. Quint, is it true that there's $9.6 billion in this
fund and that we're pushing out $40 million a year? Are those
numbers correct?
Mr. Quint. I have no reason to doubt Senator Franken's
numbers. But I do not know.
Senator Schatz. OK, well for the committee's record.
Mr. Quint. We can get that information for you.
Senator Schatz. Can we have a better understanding of
revenue and expenses and the cash balance there. I understand
there may be a need to keep some cash reserves to make sure
that projects can be pushed out. But that ratio sounds fat
especially given that members of this committee has expressed
such urgency in their various communities.
So if you could get a more rigorous response to the
committee for the record, we'd appreciate that.
Mr. Quint. We would love to.
Senator Schatz. Thank you very much.
If there are no further questions I'd like to thank our
witness for his testimony. Testimony and any statements we
received related to today's hearing will be made part of the
official hearing record.
We will also keep the record open for 2 weeks to receive
any additional statements.
With that, this hearing is adjourned.
[Whereupon, at 3:20 p.m., the hearing was adjourned.]
APPENDIXES
----------
Appendix I
Responses to Additional Questions
----------
Response of Robert Quint to Question From Senator Schatz
Question 1. Is Congressional approval of these Acts in the best
interest of the beneficiaries?
Answer. The Department's positions on the seven bills before the
Subcommittee was specific to each of their Reclamation-specific
provisions. In every case, the Department believes its position is in
the best interest of the United States and taxpayers as a whole.
Responses of Robert Quint to Questions From Senator Wyden
Question 1. What I heard the administration say at Tuesday's
hearing are the same objections from the Bureau that I heard last
time--namely that the Title XVI list is chock full and there's no room
for any newcomers. How long will it take at current funding levels to
get through the current Title XVI backlog?
Answer. The remaining Federal cost share for all authorized Title
XVI projects is approximately $568 million. Projects considered active
have an outstanding Federal cost share of approximately $375 million.
The President's budget request for the Title XVI Program was $20.2
million in FY 2013 and is $14 million in FY 2014. Assuming that no
additional projects are authorized, and assuming annual appropriations
within the range of recent requests, the time required to provide the
maximum authorized Federal cost share for active projects would be
between 18 and 26 years.
Question 2. I'm concerned the Bureau's self-imposed policy of
opposing any additions to the list ignores a prospective project's
individual merit, progress through the process, and expected benefits.
How does the Bureau take those qualities into consideration when
evaluating projects on the list? Does the Bureau make similar
evaluations of prospective projects for which its assistance is
requested?
Answer. In 2010, Reclamation developed funding criteria to identify
Title XVI 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. Reclamation has incorporated these
criteria into funding opportunity announcements used each year to
invite sponsors of authorized projects to apply for funding. Proposals
are evaluated against these criteria to identify projects for funding.
We believe this process has been successful at allowing Reclamation to
prioritize the projects that most closely match program goals through a
process that is transparent to all potential applicants and the public.
When sufficient program funding is available, Reclamation also uses
those criteria in funding opportunities that invite sponsors of
potential new projects to request a small amount of assistance to
develop new Title XVI feasibility studies.
Responses of Robert Quint to Questions From Senator Johnson
Question 1. In response to my question regarding incorporating the
existing community systems into the Mni Wiconi Project and the trust
responsibility of the United States, you answered that the BOR takes
the federal trust responsibility seriously and that BOR will work with
the other agencies. I would like additional detail, however, on exactly
how you plan to work with the other agencies, specifically on the
community upgrades effort? Would not legislation directing the agencies
to come together with timelines for action work best to ensure true
coordination and the desired outcomes?
Answer. Reclamation supports the goal of interagency cooperation
and efforts to engage other agencies to participate in the Mni Wiconi
Project utilizing their existing authorities. An interagency agreement,
as proposed by Reclamation during the August 8, 2012 Joint Consultation
Meeting with Federal Agencies, has the potential to achieve this
objective. The draft agreement discussed at that meeting provides that
the agencies will meet quarterly during the first year to evaluate and
prioritize the needed system improvements. The agencies then would
develop a schedule to fund and implement these improvements. By
coordinating this effort, the agencies, utilizing existing authorities,
would leverage multiple funding sources, and make more effective use of
available federal funds to accomplish the system improvements.
This proposed interagency agreement and effort also meets the
intent of the ``Memorandum of Understanding Among the Department of
Agriculture, Department Of Health and Human Services, Department of
Housing and Urban Development, Department of the Interior, and the
Environmental Protection Agency to Better Coordinate the Federal
Government Efforts in Providing Infrastructure and Promoting
Sustainable Practices to Support the Provision of Safe Drinking Water
and Basic Sanitation in American Indian and Alaska Native Communities''
signed in March 2013.
Reclamation agrees that language in this amendment to the Mni
Wiconi Project Act would provide further direction to the agencies to
work together on this effort.
Question 2. Given that the existing community systems are in
operation and many are currently in a fine state [of] repair to
successfully distribute water, is it not a reasonable approach to
transfer these systems into the Project as the Act intended so they can
be eligible for OMR funding and regular maintenance per BOR standards
while also having other federal agencies assist in the systems'
improvement, repair and replacement as the legislation would provide?
Answer. Reclamation's assessment of the existing community water
systems identified a number of serious deficiencies. The majority of
the valves and hydrants are inoperable on the older systems. The
inability to perform regular flushing compromises capabilities of
disinfectants needed to meet water quality standards. Water reservoirs
lacked regular cleaning, inspection, and require coating repairs. Water
service needed to be shut off to an entire community to repair pipeline
leaks on some systems. Reclamation is also pursuing further
investigations to ascertain the condition and potential degradation of
the asbestos cement pipe installed in many of these communities.
Reclamation had previously determined costs for existing community
upgrades to be properly allocated to the construction component of the
project. Since these existing systems were originally constructed using
funds and authorities of other agencies, Reclamation believes any
improvements needed to correct deficiencies in existing systems should
be funded by those other agencies before those systems are accepted
into the project. These communities are, or will be, connected to and
provided water from the Mni Wiconi Project which will significantly
reduce their current and future operating expenses in the interim while
deficiencies are being addressed. Once existing facilities have been
upgraded, community water systems may be transferred into, and operated
and maintained as a part of, the entire Mni Wiconi Project.
Question 3. The Mni Wiconi Project Act is clear that the existing
community systems are to be a part of the Oglala Sioux Rural Water
Supply System, the Rosebud Sioux Rural Water System and the Lower Brule
Sioux Water System and the Act authorizes the use of operation and
maintenance appropriations for these systems. Given this and the fact
that a majority of the population on each of the three reservations is
served by these existing systems, wouldn't you agree that these
authorized appropriations need to be used to upgrade these systems
prior to and after the transfer in order to fulfill the intentions of
the Act and the trust responsibility of the United States which is
specifically set forth in the authorizing Act?
Answer. While the Act authorizes existing water systems to be part
of the project, it does not authorize the use of O&M funds for the
initial costs to remedy water system deficiencies. The initial costs to
remedy the deficiencies in the existing water systems should
appropriately be allocated to the construction costs of the project.
However, the Final Engineering Report for the project and the remaining
construction ceiling does not include funds for the needed improvement
to integrate some existing community systems into the project. In view
of this situation, under the existing ceiling most of these communities
will be connected and served water from the Mni Wiconi Project, thereby
fulfilling the intent of providing reliable, quality water to the
residents of these reservations. The communities that will not be
connected within the existing construction ceiling currently have an
adequate water supply system. Reclamation estimated the cost to remedy
the existing water system deficiencies at $29 million. Placing the
burden of the cost of improving existing water systems on Reclamation's
O&M program reduces funding needed for ongoing maintenance for
Reclamation's critical water and power infrastructure (including Mni
Wiconi) and jeopardizes their reliability and safety. Since authorities
to address these community water system deficiencies reside under other
agencies, we believe the interagency agreement, prioritization, and
funding approach previously described would best address this issue.
Question 4. You mentioned an interagency agreement proposed by
Reclamation during an August 2012 Joint Consultation meeting. Could you
please tell us the progress that has been made in developing such
interagency agreement and what specifically Reclamation is doing to
further progress?
Answer. A draft agreement was distributed and discussed at that
meeting. The agencies in attendance concurred with the intent of the
agreement. After that meeting, the Oglala Sioux Tribe requested that
further discussions and revisions to the agreement be delayed while the
Mni Wiconi Amendment was introduced and acted upon.
Responses of Robert Quint to Questions From Senator Barrasso
Question 1. Can you define what a ``rural water project'' is
supposed to mean with regard to S. 715? The term that is defined in the
2006 Rural Water Supply Act is ``rural water supply project'' not
``rural water project.''
a) How would the Bureau of Reclamation define the term
``rural water project'' if the term is not defined in this
bill?
b) What projects would this cover?
Answer. Reclamation defines a ``rural water project'' as a specific
project that has been authorized by Congress and meets the criteria in
the Rural Water Supply Act (the Act) of 2006, which became P.L. 109-
451. Although the term in S. 715, ``rural water project'' does not
exactly match ``rural water supply project'' as defined in the Act,
Reclamation believes the intent to be the same and would use the
definition for new projects that meets the Act's criteria. The term
``rural water supply project'' means a project that is designed to
serve a community or group of communities each of which has a
population of not more than 50,000 inhabitants, which may include
Indian tribes and tribal organizations, dispersed homesites, or rural
areas with domestic, industrial, municipal, and residential water. It
also includes incidental livestock watering and noncommercial
irrigation of vegetation and small gardens of less than 1 acre.
There are currently seven remaining authorized rural water supply
projects: Garrison Diversion Unit; Mni Wiconi Rural Water System (RWS);
Lewis and Clark RWS; Fort Peck Reservation-Dry Prairie; North Central-
Rocky Boys; Jicarilla Apache RWS; and Eastern New Mexico. The bill
would also cover any projects recommended by the Secretary and
subsequently authorized by Congress on the basis of a feasibility study
submitted to the Secretary on or before September 30, 2012. Reclamation
received two feasibility studies before that date: the C.C. Cragin
Reservoir Water Supply Project (Payson, Arizona) and Dry Redwater Rural
Water System (east central Montana) feasibility studies. If authorized
by Congress, these projects would be eligible for funding.
Question 2. On page 3 of S. 715, with regard to expenditures from
the rural water fund, it says the Secretary ``may expend from the fund
not more than the sum of $80 million.'' In section (2) on page 4, it
states again that ``the Secretary may use the amounts from the fund to
complete construction of rural water projects.''
a) Does this language give the Secretary the ability not to
spend the money on some of the authorized rural water projects
that qualify for funding in this bill?
b) Is this mandatory spending? If this is mandatory spending,
why would it make sense to give the Secretary this discretion?
Answer. a) Yes, the Secretary has the discretion to allocate
appropriations among the authorized projects, including the ability to
not spend money on some authorized projects. However, the Secretary's
discretion is limited by the conditions in Section (3) on pages 5
through 7, which stipulate that appropriations must be used to achieve
defined programmatic goals and that the Secretary must develop
prioritization criteria to distribute funds from the rural water
construction fund.
In compliance with previous direction from received from Congress
in 2012, Reclamation developed and applied funding prioritization
criteria that meet the requirements of this bill. The criteria were
published in Reclamation's 2012 draft assessment report ``Assessment of
Reclamation's Rural Water Activities and Other Federal Programs that
Provide Support on Potable Water Supplies to Rural Water Communities in
the Western United States'' (www.usbr.gov/ruralwater/docs/Rural-Water-
Assessment-Report-and-Funding-Criteria.pdf).
Answer. b) No, the spending is discretionary. There are two reasons
the Administration supports discretionary funding for these projects.
First, spending on rural water construction projects competes with
other priorities within Reclamation's budget, including aging
infrastructure, Indian water rights settlements, environmental
compliance and restoration actions, facilitating more sustainable water
supplies, and other priorities intended to address future water and
energy related challenges. The bill requires offsets for any amount
expended from this fund. Therefore, use of those funds must be weighed
against other Federal priorities, including deficit reduction.
Second, the Secretary's discretion will enable Reclamation to
prioritize the allocation of funds in a way that will expedite the
delivery of water and other project benefits as intended, while
emphasizing program priorities. As noted above, Reclamation has already
developed and applied project prioritization criteria that meet the
requirements of the bill. In addition, Reclamation has stated that
while it would allocate larger amounts of available funding to higher-
ranked projects, all projects would receive some funding unless special
circumstances dictated otherwise. An example of a special circumstance
would be a project for which previous years' appropriations had not
been fully expended. The Secretary's discretion would allow Reclamation
to direct more funding toward the completion of authorized projects in
the year funds are appropriated.
Section 3 (b) (1) of the S. 715 states that the Secretary of the
Treasury shall deposit in the Fund $80,000,000 of the revenues that
would otherwise be deposited for the fiscal year in the Reclamation
fund. This section further states that the amounts deposited in the
Fund shall be made available in accordance with this section without
further appropriations. This language clearly removes some discretion
from the administration for other uses of this funding. The use of the
term ``may'' as referenced in your question provides some discretion on
whether the funds are fully expended each year and the timeframe under
which expenditures occur. If a rural water project did not have plans,
specifications, and rights-of-way prepared, they may not have the
capability to expend all of the funds in a specific year, whereby the
funds would be held until needed.
Question 3. With regard to page 3 of S. 715 under the section
entitled ``Limitation'' it states that ``no amounts may be deposited
in, or made available from, the Fund under those paragraphs if the
transfer or availability or the amounts would increase the deficit.''
a) Can you provide me a list of all projects or programs that
will be reduced or revenue accounts that will be increased to
make this bill deficit neutral?
b) What are the different ways that the Secretary can use to
make these transfers deficit neutral?
c) Shouldn't there be a formal process to ensure this bill
will be deficit neutral?
Answer. The legislation is silent as to which projects or programs
should be reduced under its provisions, as well as means to assure that
there is no impact on the deficit. As such, if the bill were enacted,
implementation of this language would require the Department to go
through a process, working with the Department of the Treasury and
Office of Management and Budget, to transfer the funds called for under
Section 3(e).
Appendix II
Additional Material Submitted for the Record
----------
Statement of the Department of the Interior, on S.J. Res. 12
Thank you for providing the Department of the Interior the
opportunity to provide its views on Senate Joint Resolution 12 which
proposes to consent to and approve three amendments, Act 107, 2000
Hawai`i Session Laws, Act 12, 2002 Haw. Sess. Laws, and Act 16, 2005
Haw. Sess. Laws., proposed by the legislature of the State of Hawai`i
to the Hawaiian Homes Commission Act (HHCA), 1920, as amended.
Specifically, S.J. Res. 12 seeks to amend the HHCA to allow the
interest rate on loans from the Hawaiian home-loan fund and the
Hawaiian home general loan fund to be set by the Hawaiian Homes
Commission through an administrative rule, rather than by law. S.J.
Res. 12 also changes the qualifications of homestead lessees by
authorizing a Hawaiian Homes Commission Act homestead lessee to
transfer, or designate a successor to, their leasehold interest to a
brother or sister who is at least one-quarter Native Hawaiian.
By way of background, Congress enacted the HHCA in 1921 to provide
a homesteading program on approximately 200,000 acres of land, called
the ``available lands,'' for native Hawaiians. In section 4 of the
Hawai`i Admission Act, 73 Stat. 4, Congress required ``the consent of
the United States'' to certain State of Hawai`i enactments amending the
HHCA. In section 204 of the Hawaiian Home Lands Recovery Act (HHLRA) of
November 2, 1995, 109 Stat. 361, Congress formalized the role of the
Department in securing any required congressional consent and approval
to State enactments.
The HHLRA provides that the Department is to review proposed state
amendments to the HHCA to determine whether congressional approval is
needed to effectuate the United States' consent required under Section
4 of the Hawai`i Admission Act. If the Department deems that
congressional approval is not required, it so notifies the State of
Hawai`i and Congress. If the Department deems that congressional
approval is required, as the Department has for the three proposed
amendments that are the subject of S.J. Res. 12, the Department is to
submit a draft joint resolution approving the amendments to Congress,
together with a recommendation on whether they should be approved.
Here, we wish to acknowledge that the introduced bill was a product of
close collaboration among the Committee on Energy and Natural
Resources, the Department, and the Hawai`i Senate delegation.
In carrying out the Department's statutory trust responsibilities
to the beneficiaries of the HHCA, the Department obtained input from
participants during a Beneficiary Forum with the Department's Office of
Native Hawaiian Relations. The forum was held in May 2008 in Hawai`i to
discuss with leaders of the Native Hawaiian beneficiary community the
State enactments proposed to amend the HHCA. Due to public request, the
Department extended the comment period and conducted an electronic
consultation with the Native Hawaiian community.
Based upon the Department's review and the criteria listed in
section 4 of the Hawai`i Admission Act, the Department determined that
Act 107, 2000 Haw. Sess. Laws, Act 12, 2002 Haw. Sess. Laws, and Act
16, 2005 Haw. Sess. Laws, require congressional consent before such
proposed amendments take on the force of law. The Department supports
the United States consenting to and approving of Act 107 and remains
neutral on the consenting to and approving of Acts 12 and 16.
This concludes the Department's prepared testimony on S.J. Res. 12,
and the Department would be happy to answer any questions the
Subcommittee may have.
______
Statement of Lennis ``Red'' Arndt, Chairman, Lewis & Clark
Regional Water System, on S. 715
Mr. Chairman, Ranking Member and Members of the Committee:
My name is Red Arndt, Chairman of the Lewis & Clark Regional Water
System. On behalf of our Board of Directors, I am pleased to submit
this statement in strong support for the Authorized Rural Water
Projects Completion Act.
Our Executive Director, Troy Larson, testified in support of the
bill at last year's hearing. We were disappointed that the bill did not
become law, but optimistic that with renewed effort S. 715 will pass
the 113th Congress and be signed by the President. This bill was and is
perhaps the last, best opportunity for Lewis & Clark and other
authorized rural water projects to receive the federal funding that is
due and ensure the estimated 300,000 people in the tri-state region can
benefit from the Lewis & Clark Regional Water System.
Authorized and signed into law in 2000, the project is according to
the Bureau of Reclamation, currently 76 percent complete. Last July we
began producing treated water from our treatment plant, which is being
delivered to 11 of our 20 members. Lewis & Clark is now an operational
system, which is the good news. However, the bad news is the schedule
to connect the remaining nine members is entirely dependent upon
federal funding, which for the last four years has been gutted to the
point where it does not even cover the rate of inflation on the
remaining federal cost share ($2 million in FY11, $5.5 million in FY12,
$4.5 million proposed for FY13 and $3.2 million proposed for FY14).
The three states and 20 local members have pre-paid close to $154
million, representing 100 percent of the non-federal cost share. Many
members pre-paid millions a decade before expecting to receive water,
showcasing the strong local support and importance of Lewis & Clark to
the region. By contrast the remaining federal cost share increased from
$194.3 million in 2010 to $200.6 million in 2011. That number will
increase when the Bureau of Reclamation provides us with the 2012
number sometime in May of this year. This demonstrates how federal
funding is not even keeping pace with inflation. We are on a path to
infinity. Even if Lewis & Clark receives $10 million a year, our
engineers estimate the project would not be completed until 2050.
This delay is a double-whammy for taxpayers. Not only does the
project become more expensive, but it takes longer to realize the
economic benefits. Lewis & Clark would create thousands of jobs on the
front end through construction and manufacturing, and more importantly
many more long-term jobs on the back end through expanded economic
development. As has been noted by our tri-state congressional
delegation, Lewis & Clark will pay for itself many times over.
We have a number of economic impact examples. A large pork
processing plant in Worthington, Minnesota cannot expand because of the
lack of water. Ethanol plants have been turned away in northwest Iowa
and southwest Minnesota. Proposed dairies have been turned away in
southwest Minnesota.
When times get tough you go back to the basics. What is more basic
than drinking water? It's the cornerstone of life and economic
development. The three states and 20 local members have gone above and
beyond by pre-paying their share of the project. To be perfectly frank,
there are no words left but cuss words to describe the members' anger
and outrage that the federal government is not honoring its commitment.
Given the drought, the federal government is leaving us high and dry at
a time when we need water the most.
Lewis & Clark greatly appreciates the strong bi-partisan support it
has enjoyed through the years from our tri-state congressional
delegation. We applaud Chairman Baucus for his leadership on this issue
and the Senate Energy & Natural Resources Committee for this hearing.
We respectfully urge Congress to pass this bill so Lewis & Clark and
the other projects that are languishing on the Bureau of Reclamation's
plate can be completed in a timely manner, bringing much needed water
to our nation's heartland. Thank you.
______
Statement of Ed Brookshier, City Manager, City of Hermiston, OR, on S.
693
Chairman Schatz and Members of the Subcommittee, thank you for
holding this hearing and allowing me to testify in support of S. 693
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 has negotiated 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 NPDES 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 met to
finalize this agreement in June 2011 and the final permit was signed in
2012. A comprehensive feasibility study has been completed on the
project and the Bureau of Reclamation has verified 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 diversity its economy with food
processing, cold storage, 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 in
2013. 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 long-term nature of this solution.
The region as a whole also benefits from the 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 2013 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.
Mister 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.
______
North Central Montana Regional Water Authority,
Havre, MT, April 25, 2013.
Hon. Brian Schatz,
Chairman, Subcommittee on Water & Power, U.S. Senate, Washington, DC.
Hon. Mike Lee,
Ranking Member, Subcommittee on Water & Power, U.S. Senate, Washington,
DC.
Re: Comments Submitted to U.S. Senate Committee on Energy and Natural
Resources; ``Authorized Rural Water Projects Completion Act'' (S. 715)
On behalf of the North Central Montana Regional Water Authority
(NCMRWA), we appreciate the opportunity to submit comments to the
Senate Subcommittee on Water and Power regarding Senate Bill 715, the
``Authorized Rural Water Projects Completion Act''. The NCMRWA
appreciates the ongoing efforts of the Montana state delegation, as
displayed by this legislation, to work within the halls of Congress to
ensure that such basic necessities as adequate water infrastructure is
made available to all of the citizens of Montana.
It is with this sentiment in mind that we draw upon the words that
Senator Max Baucus used in his official testimony regarding S. 715;
Senator Baucus referenced the number of Montanans that must still rely
upon outdated and unreliable wells for their domestic water needs. This
bipartisan bill will aid in securing the necessary Congressional
authority and direction to continue the construction and work being
done to bring water to all of those in Montana and the surrounding
regions.
As represented in the President's Fiscal Year 2014 budget, there
are proposed funds of $5.4 million that, if enacted, will be allocated
to the Montana water project. However, the uncertainty of today's
budget environment in D.C. does not lend certainty to this issue moving
forward, which makes the passage of S. 715 paramount in order to secure
the establishment of a Reclamation Rural Water Construction Fund within
the Treasury. Were S. 715 passed, the fund will require a designated
appropriation of funds within the account for each fiscal year between
2014 and 2030, to be used solely for the purpose of the completion of
rural water projects.
While a reliable water infrastructure system is taken for granted
by many Americans, those in Montana know the precious nature of such a
luxury that is not yet made widely available to the population. While
we appreciate the $40 million that has been proposed as allocated to
the Bureau of Reclamation within the President's FY 2014 budget, we ask
that Congress also take action on this issue and provide certainty to
all Montanans that a permanent and secure water supply be made
available. Through the passage of S. 715, rural communities across the
country will be provided not only with the necessary means by which to
secure such a basic necessity but also the federal support by which to
do so.
We appreciate the opportunity to submit comments on this needed
legislation; if you require any additional information or have any
further questions regarding S. 715 and its impact on Montana we
encourage you to contact Larry Bonderud 406-450-5196.
Sincerely,
Larry Bonderud.
______
Prepared Statement of the Oglala Sioux Tribe, Rosebud Sioux Tribe,
Lower Brule Sioux Tribe and West River/Lyman-Jones, on S. 684
INTRODUCTION
Thank you for the opportunity to submit testimony on this most
important legislation, S.684, the Mni Wiconi Project Act Amendments of
2013. This testimony has been developed conjunctively and is offered on
behalf of the Oglala Sioux Tribe, West River/Lyman-Jones, Inc., the
Rosebud Sioux Tribe and the Lower Brule Sioux Tribe, the four
beneficiaries and sponsors of the Mni Wiconi Rural Water Supply System
in southwestern South Dakota (Figure 1)*. S. 684, Re-authorization of
the Mni Wiconi Project, will:
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* Figure has been retained in subcommittee files.
increase the authorized Project ceiling for construction by
$14.308 million (October 2012 dollars) for completing drinking
water distribution projects on the Pine Ridge and Rosebud
Indian Reservations,
extend the completion of construction through 2016,
transfer existing community water systems to the Project
within 5 years of enactment of S. 684 and
provide for interagency agreements between the Bureau of
Reclamation and
--EPA,
--Department of Agriculture
--Department of Health and Human Services and
--Department of Housing and Urban Development
--Bureau of Indian Affairs
to assist with completing the tribal rural water systems including
the upgrade of existing water systems in reservation
communities, and in the case of the Department of Agriculture
and Bureau of Indian Affairs, assist in completing the
livestock distribution system to reservation rangelands
consistent with the original intent of the Project.
In an effort to reach an agreement with the Bureau of Reclamation
on the scope of the reauthorization, the Project Sponsors have
eliminated the following provisions from S. 3464, which was introduced
in 2012 and is now embraced in S.684:
extension of the service area of the Oglala Sioux Rural
Water Supply System (OSRWSS) to include a small area of
reservation trust land in Nebraska;
recover water costs for Rosebud Sioux tribal members on
Trust Land in the community of White River
the Mni Wiconi Project Emergency Plan
mitigation of fish and wildlife losses
feasibility studies of wastewater systems
The Bureau of Reclamation continues to oppose the reauthorization
despite our good-faith efforts to reach agreement.
Since introduction of S. 3464 in 2012 and the hearing of this
Subcommittee on September 19, 2012, additional construction needs have
been identified on the Pine Ridge and Rosebud Indian Reservations, but
no increase in the reauthorization is requested.
On the Pine Ridge Indian Reservation, for example, the need for a
new interconnecting pipeline between the east and west side of Pine
Ridge Village was identified by the Bureau of Reclamation. The facility
has an estimated cost of $620,000. Parts of the supervisory control and
data acquisition (SCADA) system for the Reservation may not be covered
by the authorized construction ceiling. Rural services in the Wounded
Knee and Rainbow Valley areas may exceed the authorized construction
ceiling. These costs are in addition to the $8.6 million in additional
funding needed to serve the Allen/Batesland/Martin service area, which
is the Pine Ridge part of the $14.308 million construction
reauthorization request brought forward from S. 3464 to S.684.
Offsetting the increases in construction costs, the Director of the
Oglala Sioux Rural Water Supply System (OSRWSS), for example, has been
identifying real savings in the SCADA system and in the elimination of
other unnecessary costs. Combined with favorable bidding results since
last fall, it is contemplated that the Directors (and Tribal
leadership) of both the OSRWSS and the Rosebud Sioux Rural Water System
(RSRWS) can re-prioritize construction segments and complete the
drinking water portion of the Mni Wiconi Project within the $14.308
million reauthorization request. In the event of surplus funds, they
will be applied to much needed community system upgrades.
Individually and collectively, the Project Sponsors support S. 684
and seek the support of the Subcommittee.
PROJECT HISTORY
The Mni Wiconi Project Act of 1988 (Public Law 100-516) authorizes
and directs the Secretary of the Interior to construct the Mni Wiconi
Rural Water Project to provide a safe and adequate municipal, rural,
and industrial water supply to both Indian and non-Indian residents of
southwestern South Dakota. The Act recognizes the poverty on the
reservations and severely poor water quantity and quality on the
reservations and in the West River/Lyman--Jones service area.
Significantly, the Act also recognize the United States trust
responsibility to ensure that adequate and safe water supplies are
available to meet the economic, environmental, water supply, and public
health needs of the reservations.
The Mni Wiconi Project has reached an historic milestone following
the long struggle beginning in 1988 of the Oglala Sioux Tribe and West
River/Lyman-Jones to complete this invaluable drinking water project.
The Rosebud Sioux Tribe began work on their rural water system in 1984
and became part of the Mni Wiconi Project with the passage of P.L. 103-
434 in 1994. The Lower Brule Sioux Tribe also joined the Project in
1994 and its water system is completed pursuant to an agreement among
the Sponsors for early completion which resulted in substantial savings
for the Project. S.684 provides the means to fulfill the vision of safe
and adequate water supply for Oglala Sioux and the Rosebud Sioux
Tribes.
The Project is a testament to the ability of the tribal sponsors
and non-Indian neighbors to collaborate to improve the health and
welfare of our respective constituencies. When the Project was
initiated, relationships between us were strained at best and governed
by events many generations before us but still fresh in the minds of
our peoples. As the Project reaches its conclusion, we have built
mutual respect and a relationship that evolved from the necessity of
working together toward a common good. None of this would have been
possible without the continuous efforts of the Subcommittee and the
South Dakota delegation, and especially the sponsor of S. 684, the
Honorable Tim Johnson.
It is important that the Committee understand the background upon
which we embarked to build the largest rural water project in the
world. In the beginning we were joined by our partners in the project,
West River/Lyman-Jones, for the purpose of bringing good quality water
from the Missouri River to the Badlands of Western South Dakota. The
Missouri River as a water source is important to the Lakota people
because the River is contained within the Great Sioux Reservation
established by the Treaty of 1868. Our forefathers saw to it that the
entire Missouri River was included in the lands reserved to us. The
water users in the West River/Lyman-Jones service area live within the
boundaries of the Great Sioux Reservation, which includes all of South
Dakota west of the left high bank of the Missouri River.
As formulated in the late 1980s, the Project was of great concern
to the members of the Oglala Sioux Tribe. They felt the history of
water projects on Indian reservations at that time would be played out
on the Pine Ridge Indian Reservation: that non-Indian interests would
receive water and Project benefits quickly and Indians would be left
with delay and necessary Project features unfinished. They looked at
the projects authorized on the San Juan River in June 1962, and
observed that non-Indians received project benefits immediately, but
the Indians still struggle to get their projects completed decades
later, even though they were authorized half a century before. They
also observed opposition to Indian projects from the Office of
Management and Budget. Based on these concerns, the majority of members
of the Oglala Sioux Tribe were opposed to the Project in its early
years.
The initial concerns were overcome by a better understanding of the
provisions of the Mni Wiconi Project Act, a reformulation of the
Project in the Final Engineering Report of May 1993 and amendment of
the Act to include the Rosebud Sioux Tribe and Lower Brule Sioux Tribe.
Significantly and of high importance to the Tribe, the United States
acknowledged in the Act a trust responsibility in the Mni Wiconi
Project Act to ensure that adequate and safe water supplies are
available to meet the economic, environmental, water supply, and public
health needs of the Pine Ridge Indian Reservation. Also, important to
the comfort level of the Oglala Sioux Tribe was the Act's provision
that title to the OSRWSS would be held in trust by the United States
for the Tribe. This includes the principal components of the Mni Wiconi
Project such as the intake on the Missouri River, the regional water
treatment plant on the Missouri River and the main transmission
pipelines from the Missouri River to West River/Lyman-Jones, the
Rosebud Sioux Tribe, the Lower Brule Sioux Tribe and the Oglala Sioux
Tribe. Further, pursuant to the Act, the Oglala Sioux Tribe entered
into a PL 93-638 (Indian Self-Determination and Education Act)
cooperative agreement with the Bureau of Reclamation to plan, design,
construct, operate, maintain and replace OSRWSS.
The Mni Wiconi Act Amendments of 1994 (Public Law 103-434, Title 8)
added the Rosebud Sioux and the Lower Brule Sioux Rural Water Systems
to serve their respective reservations, thereby increasing the number
of Project ``Sponsors'' to four. The amendments also raised the
authorized appropriation ceiling for the Project from $87.5 to $263.2
million (1993 dollars), subject to cost indexing, and provided that the
systems would generally be constructed in accordance with the Project's
Final Engineering Report, dated May 1993 for the purposes of providing
domestic, commercial, municipal, rural, industrial, and livestock
water. Completion of project construction was expected in 2003.
The overall Project includes a 14.5 million gallon per day regional
water treatment plant, 4,500 miles of pipeline, 60 booster pump
stations, and 35 water storage reservoirs. The Project will ultimately
serve more than 52,000 people, including more than 40,000 on the three
Indian reservations. It is a monumental endeavor which is providing
myriad benefits to those most in need. It is a project that must be
reauthorized to complete the drinking water components on the Pine
Ridge and Rosebud Indian Reservations.
IMPACT ON QUALITY OF LIFE AND HEALTH
It is respectfully submitted that the Project is unique and that no
other project in the Nation has greater human needs. The Project
beneficiaries, particularly the three Indian Reservations, have the
lowest income levels in the Nation. Poverty in the Indian service areas
is consistently deeper than elsewhere. At the beginning of the third
millennium one could not find a region in our Nation in which social
and economic conditions are more deplorable.
Before the Mni Wiconi Project, health risks to the Indian people
from drinking unsafe water were severe. Health effects of water borne
diseases were consistently more prevalent than elsewhere in the Nation,
due in part to (1) lack of adequate water in the home and (2) poor
water quality where water was available. Higher incidences of impetigo,
gastroenteritis, shigellosis, scabies and hepatitis-A were well
documented on the Indian reservations of the Mni Wiconi Project area.
Poverty is the harbinger of the severe health care crisis facing
the Indian people in the Northern Great Plains. The extra costs of
health-care during the lifetime of each 24,000 members of the Indian
population in the Mni Wiconi Project are estimated at $2.25 billion (in
2010 dollars). This is not total costs of health care; it is the
present value of the extra cost of life time health care relative to
the rest of the population off the reservations. Regional data suggests
clear relationships between income levels and higher mortality rates
for heart disease, cancer and diabetes with correspondingly higher
federal health-care costs.
The Mni Wiconi Project is part of the solution. It brings much
needed employment, both direct and through economic development
projects, which, in turn, engages part of our unemployed and
underemployed and brings about measurable improvement in the health of
the Lakota Nation, thereby reducing federal health-care costs and, most
of all, the tragedy in the families affected. Mni Wiconi builds the
dignity of many, not only through improvement of drinking water, but
also through increased employment and earnings during planning,
construction, operation and maintenance and from commercial enterprises
supplied with Project water.
The Project has accomplished much improvement of water quality
using a combination of water from the Missouri River and from the
Ogallala Aquifer. Homes previously reliant on water laced with unsafe
levels of arsenic, uranium and nitrite/nitrates have been placed on a
safe and reliable drinking water system, and we expect reductions in
mortality.
PROJECT FUNDING STATUS
The authorized construction funds will be 100 percent expended at
the end of FY 2013. With construction funding at the $23 million level
as proposed in the President's FY 2013 budget, the project will have
expended $470,357,000 within the current authorization. The funds will
not be adequate to complete the Project as originally planned.
The reauthorization request of $14,308,000 would bring total
funding to $484,665,000, an increase of 3.0 percent, and would complete
the drinking water portion of the Project. The livestock portion will
require programmatic funds from the Bureau of Indian Affairs and
Department of Agriculture that are not included in the reauthorization
request. The increase compares with unbudgeted overhead costs of
$26,696,000 that the Project will incur through 2013 due to inadequate
levels of funding that delayed the project: a factor completely outside
the control of the Oglala Sioux and Rosebud Sioux Tribes. These
necessary overhead costs are 5.7 percent of the authorized Project
costs and nearly double the amount requested in the reauthorization.
The extension of the Project from 2008 to 2013 did not provide for
budgeting of Reclamation oversight, administration or other
``overhead'' costs, which will have diverted $26.696 million from
construction. These costs have been and will continue to be incurred at
the expense of construction elements. The slow pace of budgeting and
appropriations has extended the Project by seven additional years from
2008 through 2016. The overhead costs in those years have depleted
construction funds by $26.696 million. S.684 will restore $14.308
million of the $26.696 million in diminished construction capability.
The $23 million remaining in authorized construction funds was
included in the President's FY2013 Budget Request. The budgeting will
be adequate to complete the allocation of currently authorized funding
but will be inadequate to fully complete the drinking water system to
persons in need. These are residents that were contemplated in the
Final Engineering Report and included in the Project design.
CONSTRUCTION CEILING INCREASE
Reauthorization of the funding ceiling by $14.308 million and a
time extension through 2016, the fourth construction sunset date, are
needed on the Pine Ridge and Rosebud Indian Reservations to complete
the drinking water systems. The West River/Lyman-Jones and Lower Brule
Rural Water Systems are complete. Under-budgeting and the slow pace of
appropriations underlie the need to reauthorize and extend the Project.
The Project authorization date was extended by PL 110-161 (2008)
from 2008 through 2013 without accompanying budgeting for
administration and other overhead costs after FY 2007. The extension
was necessary because funds had not been appropriated at a rate
sufficient to complete funding of Project construction within the
authorized construction ceiling. However, since no additional overhead
costs were budgeted for with the extension of the date, funds that
would have gone to construction were necessarily used to cover annual
overhead costs, and Reclamation encouraged the diversion of
construction funds allocated for livestock to cover overhead. Overhead
costs for the OSRWSS ($17.990 million) and the Rosebud Sioux Rural
Water System (RSRWS) ($8.706 million), a total of $26.696 million,
severely impacted the funding available for construction.
Because the budgeting of non-contract costs was not included in
previous funding authorities after FY 2007, the necessary expenditures
for Reclamation oversight and Project administration have reduced the
funds to complete construction projects. The overhead costs for years
after 2007 have depleted construction funds by $26.696 million. OSRWSS
would have ended the Project with a surplus in its construction budget
of $5,101,000 after finishing its construction projects if it had not
been required to expend unbudgeted funds on non-contract costs after FY
2007. The surplus could have been applied to community systems upgrades
or the livestock program. S.684 seeks to restore $14.3 million of the
$26.696 million unbudgeted overhead costs that diminished construction
capability.
The Concept Paper for completing the Project (prepared in several
versions in 2011 and included for the record as Exhibit A) documented a
need for an increase in the authorized construction ceiling of $29.369
million. Since the Concept Paper was completed the Director of OWRWSS ,
Mr. Frank Means, took every possible step to achieve cost savings and
to limit activities strictly to our first priority of completing the
drinking water systems to serve the present and future growing
populations on the Reservation. The Rosebud Sioux Tribe did likewise.
Lower Brule dropped $1.74 million in reservoir expansions that would
improve their system, which was completed 5 years ago. The cost
reductions limit the necessary reauthorization to $14.308 million as
presented in Table 1 and as shown in Figure 2* on the Pine Ridge Indian
Reservation.
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* Figure has been retained in subcommittee files.
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In an effort to be reasonable yet steadfast to complete the
Project, our request for reauthorization of the Project is focused only
on completing the drinking water systems. We propose to use other
avenues to accomplish community system upgrades and livestock watering
projects:
1. Funds to upgrade existing community systems on the
Reservations, a pre-requisite, according to Reclamation, for
transferring them to the Project as contemplated by the Act and
the Final Engineering Report (FER) are not requested. The
reauthorization requires Reclamation to submit a plan to
Congress for upgrades and transfer within two years of the
reauthorization and to implement the transfer within 5 years of
enactment of S. 624. Upgrades may continue for 15 years. We
disagree, but Reclamation requires transfer before making
operation, maintenance and replacement funding available. S.
684 will resolve the issue by making transfers mandatory and
communities eligible for operation, maintenance and replacing
funding to avoid further deterioration of those systems
2. The high level of investment now required by Reclamation
for upgrading the community systems was not contemplated by
Reclamation in the 2002 reauthorization (PL 107-367), December
19, 2002. This high level of cost has prevented the transfer of
existing
3. community systems to the Project and enabled their
continued deterioration due to absence of funding for
operation, maintenance and replacement.
4. The livestock components of the Project on the Pine Ridge
and Rosebud Indian Reservations will be developed outside the
new authorization through existing programs of the Bureau of
Indian Affairs and the Department of Agriculture, and new
funding authorization is not requested. The reauthorization
requires Reclamation, Agriculture and the Bureau of Indian
Affairs to work together on the livestock components.
5. While $26.969 million in unbudgeted overhead costs from
2007 through 2015 will be spent, an amount that has and will be
expended at the expense of construction elements, we are only
requesting $14.308 million to complete the drinking water
systems on the Pine Ridge and Rosebud Indian Reservations.
The $14.308 million is necessary to ensure that all intended
beneficiaries will be served. We support the bill on this ground. We
also support it for its several other provisions that address the other
needs for finishing the Project as intended which are not covered by
the $14.308 million increase.
COMMUNITY SYSTEM UPGRADES
The Mni Wiconi Act clearly states that the OSRWSS, RSRWS, and Lower
Brule Rural Water System (LBRWS) shall include the purchase,
improvement and repair of existing water systems, including systems
owned by individual tribal members and other residents on the
reservations. Sections 3(a)(4), 3A(a)(4), and 3B(a)(4). Further,
Sections 3(a)(8), 3A(8), and 3B(a)(8) state that the aforementioned
authorized rural water systems shall also include other facilities
deemed necessary to meet the water supply, economic, public health and
environmental needs of the reservations, including facilities for the
tribes, reservation villages, towns and municipalities. Finally,
Sections 3(b)(3), 3A(b)(3) and 3B(b)(3) reference the purchase,
improvement and repair of existing systems. Congress intended for
existing water systems to become a part of the Mni Wiconi Project. In
fact, the objectives of the Mni Wiconi Project cannot be met unless the
community systems are connected. Without inclusion of such systems, the
Project as intended by Congress and the Tribe would not be complete.
Reclamation has determined the costs for community system upgrades.
Overall, the costs for community system upgrades total $26.657 million.
Of this, $13.164 million is for OSRWSS. The total for the RSRWS is
$11.693 million and for the LBSRWS is $1.8 million.
Upgrades of the cost magnitude proposed by Reclamation for these
existing systems were not previously contemplated in the FER or by
Reclamation in PL 107-367, the 2002 reauthorization of the Mni Wiconi
Project Act. Reclamation's current proposal would have the systems in
near perfect condition prior to their transfer into the Project rather
than accepting these currently working systems and improving them as
needed over a period of time--when the lifetime of a feature has come
to an end. S. 684 contains language to direct the transfer of existing
community systems to OSRWSS, RSRWS or LBSRWSS as other federal
agencies' funds and Project operation, maintenance and replacement
funds are applied to the upgrade of those systems.
It does not make sense to hold up completing the Project, which
must include these existing systems, by requiring the existing systems
to be in nearly new condition prior to transfer. Instead, systems
should be transferred into the Project and a schedule for conducting
priority upgrade work should be established using operation,
maintenance and replacement (OMR) Project funding.
An essential new provision in S.684 is the transfer of existing
community systems to the OSRWSS, RSRWS, and LBRWS within five years of
the enactment of S.684 or three years after the completion of the
Secretary's plan for transfer. The purpose of the provision is to
ensure the operation, maintenance and replacement of those systems at
the earliest practical date. In the absence of a transfer, the
maintenance of those systems will languish and deterioration will
accelerate.
OSRWSS is working to seek funding from other federal agencies such
as HUD, Rural Development, IHS and EPA to assist in upgrading the
existing community systems. Two central issues have arisen: (1) the S.
684 language on the community system upgrades is needed to direct the
agencies to assist; and (2) Reclamation cannot evade its
responsibility. Reclamation is still the responsible federal agency,
and it must adhere to its trust responsibility and fund the costs of
community systems upgrades (not funded by other federal agencies), a
central tenet for ensuring adequate and safe water to the people on the
reservation, through the operation, maintenance and replacement
program. We support the continuation of operation, maintenance and
replacement funding by other agencies that have historically
contributed, including HUD and BIA, to reduce funding required from
Reclamation.
S. 684 would direct the necessary other agency assistance for the
community systems upgrades and direct that the systems be transferred
and the operation, maintenance and replacement monies appropriated to
Reclamation under the Act be used to improve, repair and replace those
systems. These provisions of S.684 are fundamentally important to the
completion of the overall Project and for ensuring that the Project can
function and serve its beneficiaries as intended.
LIVESTOCK NOT INCLUDED IN FUNDING REQUEST
Water for livestock on the Pine Ridge and Rosebud Reservations was
contemplated in the Final Engineering Report and in the original
Project authorization and subsequent reauthorization.
OSRWSS has reduced its livestock distribution system from $24.024
million to $11.380 million, and OSRWSS has removed its diminished
livestock plan from the funding needed in the amendment of the Mni
Wiconi Project Act. Likewise, Rosebud prioritized providing water for
direct human consumption and reduced planned livestock water
expenditures from $3.930 to less than $150,000. The Rosebud Sioux Tribe
has developed a collaborative system with operators and the Natural
Resource Conservation Service to construct individual stock taps. Both
Tribes intend to work with the Natural Resources Conservation Service
and the Bureau of Indian Affairs to construct the livestock
distribution systems over a period of 15 years. However, enactment of
S. 684 is needed to direct these agencies to undertake the work and
fund this important and intended component of the Project. As stated
previously, the Bureau of Reclamation urged that funding intended for
livestock construction be used to finance the overhead costs after
2007, and the livestock program was sacrificed for necessary non-
construction activities that had not been budgeted.
ADEQUATE FUNDING FOR OPERATION, MAINTENANCE AND REPLACEMENT FOR
EXISTING MNI WICONI PROJECT FACILITIES
In addition to expressing our support for S. 684, we take this
opportunity to raise a very important concern of the tribal sponsors:
the need for adequate operation, maintenance and replacement (OMR)
funding. The Mni Wiconi Act clearly sets forth the trust responsibility
of the United States to ensure adequate and safe water supplies are
available to meet the economic, environmental, water supply and public
health needs of the reservations, and established the framework for
Reclamation to fund the construction and OMR of the Project, Section
2(a)(5), Section 10(a) and (b). The Act authorizes, among other things,
the construction, operation and maintenance of municipal, rural and
industrial water systems which include the existing water systems,
Section 3(a), 3A(a) and 3B(a). Reclamation needs to work with the
OSRWSS, RSRWS and LBRWS to ensure the remaining features of the
Project, including the work related to existing community systems, are
completed as planned and the intended beneficiaries are served.
The Act's trust responsibility provision is applies equally to
construction and OMR. Anything less than sufficient funding for OMR
threatens the significant investment of the United States in
construction.
Reclamation needs to work with the OSRWSS to adequately fund OMR of
the core and distribution systems. The OSRWSS core facilities serve all
Project Sponsors, including the Lower Brule Sioux Tribe, Rosebud Sioux
Tribe and West River/Lyman-Jones, as well as the Pine Ridge Indian
Reservation. Reclamation advises us that OMR is its first priority. The
statutory trust responsibility requires OMR to remain at the forefront
of Reclamation's funding obligations. Funding should be adequate to
ensure a safe drinking water supply for all Project Sponsors. As we
move forward, the Mni Wiconi Project must remain a Reclamation
priority. Our OMR funding needs should not be affected by other
authorized projects' construction funding needs or by Indian water
rights settlements in the years ahead.
Threatening an unnecessary increase in the costs of OMR for the Mni
Wiconi Project are the Surplus Water Policies of the Corps of Engineers
that would require payment for stored water in Lake Oahe. The Corps of
Engineers proposes a cost of $15-$20 per acre foot of water derived
from Pick Sloan storage. The Oglala Sioux Tribe believes that the Corps
of Engineers policy on surplus water is flawed and that the charges
potentially require Congress to appropriate more OMR funds for the Mni
Wiconi Project for payment of Corps of Engineers charges.
CONCLUSION
The Mni Wiconi Project is like no other in terms of human needs.
Mni Wiconi means ``water is life.'' It is unique in that the Act which
authorized it acknowledges the United States trust responsibility to
ensure adequate and safe water supplies for the Pine Ridge, Rosebud,
and Lower Brule Indian Reservations. S.684 will enable the United
States to carry out this trust responsibility by completing the Project
as contemplated. Without S.684, intended project beneficiaries, some
who have been waiting for clean water since 1988, will not be served.
We thank the Committee for its consideration of this important
legislation and respectfully request that S. 684 moves forward to
enactment as soon as possible.
Attachment.--Supplemental Statement of the Oglala Sioux Tribe, Rosebud
Sioux Tribe, Lower Brule Sioux Tribe and West River/Lyman-Jones, on S.
684
The April 16, 2013, testimony of the Bureau of Reclamation
(Reclamation) on S. 684 has been reviewed and found extremely
troublesome. The Agency is subtly changing its narrative to not only
distance itself from funding of remaining construction but, also,
future operation, maintenance and replacement (OMR) of facilities
authorized as part of the Mni Wiconi Project. The concern begins with
the opening statement that S. 684 will ``. . . expand the scope and
authorization ceiling. . ., and have significant impacts on the budgets
of both Reclamation and the Bureau of Indian Affairs.''
First, the $14.308 million in additional construction funds is not
an expansion of the scope of the Project. It represents an increase in
Project funding by 3.0 percent or a little more than half of the
$26.696 million diverted from construction of the Project to cover
Reclamation oversight and Project administrative costs due to
inadequate Reclamation budgeting and the extension of the construction
period from 2007 through 2013 without additional funding. The $14.308
million in additional funds is required to complete the original scope
of the drinking water project, not to expand it. The Project is only
asking to complete the drinking water component as contemplated by the
Final Engineering Report approved by the Secretary in 1993. The rest of
the Project scope has been diminished (not expanded) to eliminate
livestock on the Pine Ridge and Rosebud Indian Reservations. Notably,
both the drinking water and livestock components of the West River/
Lyman-Jones system were completed without diminishment. By letter dated
March 27, 2006, Reclamation recommended to our Senate delegation that
the livestock component would serve as a source of funding for the
oversight and administrative costs that were not covered when
Reclamation prolonged project budgeting from 2007 through 2013.
Second, and consistent with its approach to construction funding,
Reclamation is for the first time questioning that the Secretary of
Interior would acquire title to existing public or tribal water systems
to be held by the United States in trust for the Tribes. This would
alter congressional intent and our understanding and is an attempt to
withdraw OMR funding for the existing systems that were and are
expected to be transferred to the Oglala Sioux Rural Water Supply
System, Rosebud Sioux Rural Water System and Lower Brule Rural Water
System. Reclamation's assertion would free Reclamation from OMR
responsibility as contemplated by Congress in Public Law 100-516.
Third, Reclamation testified that the Bureau of Indian Affairs has
no existing programs or annual appropriations for the construction,
repair or upgrading of private residences. Perhaps the insertion of the
word ``private'' helps create a half truth. The word ``private'' does
not appear in S. 684. Section 3(b)(5) is intended for homes eligible
for the Bureau of Indian Affairs Housing Improvement Program. We
acknowledge the FY 2014 budget of the Bureau of Indian Affairs proposes
to eliminate the program, which had a $12.6 million value in FY 2013.
The Bureau of Indian Affairs proposes that HUD funding could be used in
the future to replace the former Housing Improvement Program, but we
deny that the elimination of the program is an effective step and
recognize that use of HUD funds for the same purpose will divert
funding from critically needed new housing:
The budget proposes to eliminate $12.6 million in funding for
the Housing Improvement Program. The $650.0 million Housing and
Urban Development Native American Block Grant program serves
the same population as HIP. Tribes who receive HUD funding are
not precluded from using that funding to provide assistance to
HIP applicants.
(Budget Justifications, The United States Department of
Interior, Indian Affairs, Fiscal Year 2014, p. IA-0VW-3)
Finally, as Project Sponsors we support and will work effectively
with other agencies to assist in funding community system upgrades and
completion of the livestock components of the diminished Project. S.684
is needed to facilitate this and is necessary.
However, the testimony of Deputy Quint convinces us that
Reclamation will indefinitely hinder the transfer of those existing
systems to the Project as it hindered the completion of construction in
a timely manner. Reclamation's purpose is clearly to avoid OMR
responsibility currently authorized by Public Law 100-516. The
mandatory provision to transfer existing community or tribal systems
within 5 years of enactment with title held in trust by the United
States on behalf of the Tribes in the Mni Wiconi Project is an
essential provision of S. 684 The current authority for OMR funding of
existing community systems in Public Law 100-516 (the Mni Wiconi
Project Act) would not be expanded, and S.684 would set the time frame
for transfers, assure eligibility for OMR funding and prevent the on-
going deterioration of facilities in the existing systems caused by
Reclamation delays.
In conclusion, S. 684 is necessary to confirm, as originally
intended, that the existing systems will be transferred and upgraded.
The Mni Wiconi Project Act intends for these systems to be transferred
into the Project and eligible for Reclamation OMR funding. The Project
is not a complete Project without them. S. 684 sets forth a mechanism
to ensure the transfer of the existing systems and includes other
federal agencies to assist with system upgrades while holding
Reclamation to its responsibilities under the Act for these systems.
S.684 would also ensure completion of Project construction and provide
a path for construction of diminished livestock distribution systems on
the Pine Ridge and Rosebud Reservations.
______
Prepared Statement of G. Keith Denos, General Manager, Provo River
Water Users Association, on S. 211
Chairman Schatz and Members of the Subcommittee, I appreciate the
opportunity to submit this testimony for the record in support of S.
211, an amendment to the Provo River Project Transfer Act of 2004
(Transfer Act) authorizing the Secretary of the Interior to convey the
recently enclosed Provo Reservoir Canal to the Provo River Water Users
Association (Association).
The Association is the local sponsor of the Deer Creek Division of
the Bureau of Reclamation's Provo River Project. The Association is a
Utah nonprofit corporation organized in 1935 for the purpose of
providing a supplemental water supply from the Provo River Project to
its shareholders, comprised of metropolitan water districts, cities, a
conservation district, and mutual water companies and irrigation
companies.
A principal feature of the Provo River Project is the Provo
Reservoir Canal (canal), which extends 21 miles from the mouth of Provo
Canyon to Salt Lake County. For many years, the canal meandered through
pastures and orchards. By the late 1990s, suburban development had
surrounded it. Enclosing the canal into a pipe offered significant
potential new benefits in terms of public safety, water conservation,
water quality, in stream flows and recreation.
In anticipation of the enclosure of the canal (Project), the
Association concluded that owning the canal and associated project
features would be beneficial for many reasons, including the
facilitation of financing for the Project. For this and other reasons
consistent with Reclamation's policy regarding title transfer, the
transfer of title to the Association of the canal was authorized by
Congress with the passage of the Transfer Act in 2004 [Public Law 108-
382].
While ownership of the enclosed canal in fact proved crucial to
obtaining partial state financing for the Project, a number of factors
combined to delay title transfer until after completion of the Project.
The Project has proceeded as envisioned, with Reclamation's support,
but without Reclamation funding. We recently celebrated the completion
of the construction of the Project on April 5th with a ribbon cutting
conducted by Senator Orrin Hatch.
As you can imagine, the Association was extremely surprised to
learn of Reclamation's decision, both made and communicated to the
Association after substantial completion, that the Transfer Act of 2004
did not support title transfer. The Transfer Act calls for transfer of
the Provo Reservoir Canal, which is defined in the Act as the canal and
associated land and facilities ``acquired, constructed, or improved by
the Unites States as part of the Provo River Project, Deer Creek
Division . . . as in existence on the date of enactment of this Act''
[October 30, 2004]. The Regional Solicitor for the United States
Department of Interior has advised Reclamation that completion of the
Project prior to title transfer negates Congress' authority and
directive to transfer the canal to the Association, as set forth in the
Transfer Act, because the newly enclosed pipeline itself was not ``in
existence'' in 2004.
While the Association strongly disagrees with the Solicitor's
analysis, we do not consider it profitable to continue debating
Congress' intent with respect to transfer of the newly constructed
pipeline. We are confident that Congress with the continued support and
assistance of the Bureau of Reclamation Commissioner and the Department
of the Interior will move very quickly with passage of S. 211 to amend
the Transfer Act to resolve the dispute.
We look forward to working with Reclamation and our other partners
to complete the transfer of title of the canal and all associated
facilities as was contemplated in the Transfer Act.
We are grateful for the leadership and assistance of the Utah
Congressional Delegation as well as the Senate Energy Committee in
expediting consideration of S. 211.
______
Prepared Statements of the Western States Water Council
S. 659
I. INTRODUCTION
The Western States Water Council (WSWC) is a non-partisan policy
advisory body closely affiliated with of the Western Governors'
Association (WGA). The WSWC represents eighteen western states and
WSWC's members are appointed by their respective governors, and
represent their states. Our membership includes senior state water
managers and administrators.
Our testimony is based on WSWC Position #347 (attached)*, which
strongly supports legislation to reauthorize the Reclamation States
Emergency Drought Relief Act (the Act), Pub. L. 102-250, providing the
Bureau of Reclamation with much-needed tools to respond to record-
breaking drought in the West and to work with states, tribes, and local
communities to plan for future droughts.
---------------------------------------------------------------------------
* Document has been retained in subcommittee files.
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II. DROUGHT IN THE WEST
Drought has been, is, and will be an ongoing fact of life in the
arid West. Currently, as shown in the below map from the U.S. Drought
Monitor, 47.34 percent of the contiguous U.S. is experiencing moderate
or worse drought, with abnormally dry to exceptional drought conditions
covering much, if not all, of every western state except Washington.\1\
---------------------------------------------------------------------------
\1\ Kelly Helm Smith., Drought Shifts West on April 23 U.S. Drought
Monitor as Heavy Rains Drench the Midwest, NAT'L DROUGHT MITIGATION
CTR. NEWS (Apr. 25, 2013), http://drought.unl.edu/NewsOutreach/
NDMCNews.aspx?id=90.
---------------------------------------------------------------------------
Although recent precipitation has somewhat improved drought
conditions in the Midwest,\2\ the National Oceanic and Atmospheric
Administration reports that drought conditions will likely persist in
much of the West through July, with drought developing or intensifying
in some parts of Arizona, California, Nevada, New Mexico, Oregon, and
Texas.
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\2\ Id.
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These conditions follow the record breaking drought of 2012, which
was unique in terms of its sudden onset, its persistent dryness and
warm temperatures, its magnitude of extremes, and the large area it
affected.\3\ For example, over 60 percent of the contiguous U.S.
experienced moderate to extreme and exceptional drought during 2012,
with only 1934 comparable in duration and geographic extent.\4\ Last
year was also the warmest year on record for the contiguous U.S. over a
period of record dating back to 1895.\5\
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\3\ Hearing on Drought, Fire and Freeze: The Economics of Disasters
for America's Agricultural Producers before the U.S. Senate Committee
on Agriculture, Nutrition, and Forestry, 113th Cong., 1 (Feb. 14, 2013)
(statement of Roger Pulwarty, Director, National Integrated Drought
Information System).
\4\ Id. at 3.
\5\ NAT'L CLIMATIC DATA CENTER, WILDFIRES - ANNUAL 2012 (Jan. 7,
2013), http://www.ncdc.noaa.gov/sotc/fire/2012/13.
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Not surprisingly, these conditions coupled with the ongoing drought
have adversely impacted a broad spectrum of economic, environmental,
and other interests across the West and the nation as a whole, the
effects of which will reverberate for years to come. Examples include:
According to some estimates, drought costs the U.S. economy
between $6 billion to $8 billion per year in direct estimated
losses,\6\ with the cost of the 2012 drought possibly exceeding
$35 billion.\7\
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\6\ W. GOVERNORS ASS'N, CREATING A DROUGHT EARLY WARNING SYSTEM FOR
THE 21ST CENTURY, preface (2006), http://westgov.org/reports/doc--
download/394-creating-a-drought-early-warning-system-for-the-21st-
century-nidis.
\7\ Pulwarty, supra note 3 at 2 (citing Aon Benfield Reinsurance
Group's Annual Global Climate and Catastrophe Report).
---------------------------------------------------------------------------
Agriculture accounted for much of the economic costs of the
2012 drought,\8\ due in part to moderate or worse drought
conditions affecting around 70 percent of the nation's crop and
livestock production at certain times during the year.\9\
---------------------------------------------------------------------------
\8\ Id.
\9\ U.S. DEP'T OF AG., ECONOMIC RESEARCH SERVICE, U.S. DROUGHT
2012: FARM AND FOOD IMPACTS, http://www.ers.usda.gov/topics/in-the-
news/us-drought-2012-farm-and-food-impacts.aspx#.UXhHzbU4udh
---------------------------------------------------------------------------
For only the third time in over 50 years, wildfires across
the country burned more than 9 million acres in 2012, causing
over $1 billion in damage.\10\ The most damaging fires occurred
in the West, including the Whitewater-Baldy Complex Fire which
burned 297,845 acres in New Mexico's Gila National Forest.\11\
---------------------------------------------------------------------------
\10\ Pulwarty, supra note 2 at 1; NAT'L CLIMATIC DATA CENTER, supra
note 5.
\11\ U.S. FOREST SERV., WHITEWATER-BALDY COMPLEX FINAL COMMUNITY
UPDATE (June 28, 2012), http://www.fs.usda.gov/detail/gila/news-events/
?cid=STELPRDB5377297.
---------------------------------------------------------------------------
The Colorado River Basin experienced one of its driest years
in the 1895-2012 period of record, with only 44 percent of its
annual average runoff.\12\
---------------------------------------------------------------------------
\12\ Pulwarty, supra note 3 at 1, 5.
---------------------------------------------------------------------------
Skier visits to the 21 resorts that comprise Colorado Ski
Country USA were down 11.5 percent in 2012, compared to
2011.\13\
---------------------------------------------------------------------------
\13\ Id.
Notwithstanding the severity of these impacts and the relative
frequency of drought in many parts of the West and the nation, in
general, we have too often taken a reactive approach to drought,
responding on an ad hoc basis to each drought crisis as it develops.
However, over the years, many western states and federal agencies have
undertaken more proactive approaches to coordinated planning and
preparedness intended to avoid or mitigate adverse impacts before they
happen.
In particular, the WGA set an aggressive goal in 1996 to change the
way our nation prepares for and responds to drought, with subsequent
efforts by the WGA and the WSWC to promote a comprehensive,
coordinated, and integrated response to drought at all levels of
government. We have worked with federal agencies, including the Bureau
of Reclamation, to promote, proactive, cooperative drought contingency
planning and response.
III. THE RECLAMATION STATES EMERGENCY DROUGHT RELIEF ACT
The Bureau of Reclamation is the nation's largest wholesale water
supplier, providing water to over 31 million people and supplying
irrigation water to one out of five western farmers.\14\
Notwithstanding Reclamation's vital role as a water supplier in the
West, the Act constitutes the whole of its specific drought response
and planning authority. Consequently, failure to reauthorize the Act
will limit Reclamation's ability to deliver assistance in response to
present drought impacts and also limit its ability to provide much
needed assistance and technical expertise to states, tribes, and other
stakeholders as they plan for future drought impacts.
---------------------------------------------------------------------------
\14\ U.S. BUREAU OF RECLAMATION, BUREAU OF RECLAMATION: FACTS AND
INFORMATION, (Jan. 4, 2013), http://www.usbr.gov/main/about/fact.html.
---------------------------------------------------------------------------
A. Title I--Assistance During Drought
Title I of the Act authorizes Reclamation to undertake
construction, management, and conservation measures during drought to
minimize or mitigate damage or loss, including authority to act as a
``last resort'' to aid smaller towns, counties, and tribes that lack
the financial capacity to address drought impacts on their own. It also
authorizes Reclamation to acquire water to meet diverse requirements
under the Endangered Species Act, while at the same time benefiting
water users and water delivery contractors at a time when they often
face significant financial challenges. Other beneficial drought
response actions that Reclamation can undertake under Title I include:
Participation in water banks established under federal law;
Facilitation of water acquisitions between willing buyers
and willing sellers;
Acquisition of conserved water for use under temporary
contracts;
Making Reclamation facilities available for storage and
conveyance of project and non-project water;
Making project and non-project water available for non-
project uses; and
Acquisition of water for fish and wildlife purposes.
B. Title II--Drought Contingency Planning
Title II of the Act responds to Benjamin Franklin's oft-quoted
adage: ``By failing to plan, you are preparing to fail.'' Specifically,
it authorizes Reclamation to assist and participate in the preparation
of drought contingency plans in all 50 states and U.S. territories to
help prevent or mitigate future drought-related losses. Title II also
authorizes Reclamation to conduct studies to identify opportunities to
conserve, augment, and make more efficient use of water supplies that
are available to federal Reclamation projects and Indian water resource
developments to better prepare for and respond to drought conditions.
States have primary authority over the allocation and protection of
water resources within their borders. However, the WSWC has long
supported integrated water resource management and encourages the
development of comprehensive water plans with state leadership and
federal assistance. This includes a comprehensive and integrated
response to drought in which states work with federal agencies, local
communities, and other stakeholders to develop proactive drought
preparedness and contingency plans.
Title II authorizes Reclamation to engage in exactly this type of
planning, which is critical to the social, environmental, and economic
well-being of the West. Failure to reauthorize the Act will limit
Reclamation's ability to carry out this important work. This would
deprive states, tribes, and local communities of much needed technical
assistance and expertise at a time when some projections indicate that
large portions of the West, particularly the Southwest, will become
hotter and drier in coming years. Many of these areas are also
experiencing increasing demands on already scarce water supplies due to
rapidly growing populations, environmental requirements, energy
resource development, and other factors. As a result, the need for
effective drought preparedness and contingency plans has never been
greater.
IV. CONCLUSION
The exceptional drought conditions of 2012 and the ongoing drought
that covers much of the West underscores the need to reauthorize the
Act. Reauthorization will provide Reclamation with clearer direction
and greater flexibility to continue delivering water and much needed
financial and technical assistance to states, tribes and local
communities suffering from record-breaking drought impacts.
Reauthorization will also facilitate more effective state-based and
other grassroots drought preparedness and mitigation efforts. Absent
reauthorization, Reclamation will lack this critical authority to
provide emergency assistance. The WSWC appreciates the opportunity to
submit this testimony and urges the Committee to favorably report and
the Congress to pass this legislation to reauthorize the Act.
S. 715
I. INTRODUCTION
The Western States Water Council (WSWC), representing 18 western
states from Alaska to California and Texas to North Dakota, strongly
supports the Authorized Rural Water Projects Completion Act (S. 715) as
an appropriate and a timely federal investment of modest amounts that
will minimize long-term federal expenditures, create more jobs now, and
fulfill long-standing promises and trust responsibilities to rural and
Tribal communities, some of which date back decades. This testimony is
based primarily on WSWC Position #343 (attached), which we sent to
former Committee Chairman Jeff Bingaman and Ranking Member Lisa
Murkowski in the form of a letter on June 8, 2012 in support of similar
legislation (S. 3385). We also testified in support of that bill and
wish to reiterate our support for legislative action to establish a
dedicated funding source for the completion of federal rural water
projects authorized by Congress for construction by the Bureau of
Reclamation. Portions of this testimony are also based on WSWC Position
#333 (attached), which sets forth the WSWC's long-standing policy in
support of using receipts accruing to the Reclamation Fund for
authorized projects, including the types of rural water projects that
would receive funding under S. 715.
II. THE NEED FOR RURAL WATER PROJECTS IN THE WEST
Across the West, rural communities are experiencing water supply
shortages due to drought, declining streamflows and groundwater
supplies, and inadequate infrastructure, with some communities hauling
water over substantial distances to satisfy their potable water needs.
Moreover, those water supplies that are available to these communities
are often of poor quality and may be impaired by naturally occurring
and man-made contaminants, including arsenic and carcinogens, which
impacts their ability to comply with increasingly stringent federal
water quality and drinking water mandates. At the same time, many rural
and Tribal communities in the West are suffering from significant
levels of unemployment and simply lack the financial capacity and
expertise to finance and construct needed drinking water system
improvements.
Since the 1980s, Congress has authorized Reclamation to address
this need by designing and constructing projects to deliver potable
water supplies to rural communities in the 17 western states.
Furthermore, Congress established Reclamation's Rural Water Supply
Program when it enacted the Rural Water Supply Act of 2006 (Pub. L.
109-451), authorizing the agency to work with rural communities in the
West, including Tribes, to assess potable water supply needs and
identify options to address those needs through appraisal
investigations and feasibility studies.
In 2009, the WSWC worked closely with Reclamation to identify
sources of information on potable water supply needs in non-Indian
rural areas of the West. Reclamation released a draft assessment report
on July 9, 2012 (``Draft Report'') that discusses the results of this
effort, finding that the identified need for potable water supply
systems in rural areas of the 17 western states ranges from $5 billion
to $8 billion, not including another estimated $1.2 billion for
specific Indian water supply projects.\1\
---------------------------------------------------------------------------
\1\ BUREAU OF RECLAMATION, ASSESSMENT OF RECLAMATION'S RURAL WATER
ACTIVITIES AND OTHER FEDERAL PROGRAMS THAT PROVIDE SUPPORT ON POTABLE
WATER SUPPLIES TO RURAL COMMUNITIES IN THE WESTERN UNITED STATES, 8
(July 9, 2012), http://www.usbr.gov/ruralwater/docs/Rural-Water-
Assessment-Report-and-Funding-Criteria.pdf.
---------------------------------------------------------------------------
The Draft Report notes that there are currently eight active rural
water projects located in Montana, New Mexico, North Dakota, and South
Dakota, including the Lewis and Clark Rural Water Supply Project, which
is located mostly in South Dakota but encompasses parts of the non-
Reclamation states of Iowa and Minnesota.\2\ The report also notes that
of eleven rural water projects that Congress authorized Reclamation to
undertake between 1980 and 2007 (when the Rural Water Supply Act was
enacted), only four have been completed.\3\
---------------------------------------------------------------------------
\2\ Id. 3 - 4.
\3\ Id. at 3.
---------------------------------------------------------------------------
According to Reclamation, the total amount of Federal funding
needed to complete the eight authorized projects is now $2.6 billion,
which is substantially higher than the $2 billion Congress originally
authorized. This increase is due in part to inflation and the rising
costs of materials and labor. Nevertheless, the Draft Report estimates
that these authorized projects could be completed by 2029 at a total
Federal cost of around $3 billion, so long as Federal funding reflects
the estimates provided in the original final engineering reports for
each of the authorized projects--about $162 million annually. However,
at current funding levels of around $50 million annually for
construction, Reclamation estimates that some projects could be delayed
beyond 2063 despite the expenditure of almost $4 billion in Federal
funds by that point. Moreover, an additional $1.1 billion in Federal
expenditures would be needed to complete those projects that are not
completed by 2063.\4\ Notably, Reclamation is seeking only $40 million
for its rural water program in fiscal year (FY) 2014, a significant
reduction from current levels.\5\
---------------------------------------------------------------------------
\4\ Id. at 5.
\5\ U.S. BUREAU OF RECLAMATION, RECLAMATION'S FISCAL YEAR BUDGET
REQUEST IS MORE THAN $1 BILLION (April 10, 2013), http://www.usbr.gov/
newsroom/newsrelease/detail.cfm?RecordID=42744.
---------------------------------------------------------------------------
III. FEDERAL FUNDING FOR RURAL WATER PROJECTS UNDER S. 715
S. 715 would provide $80 million per year for each of fiscal years
2014 through 2030 to complete the construction of rural water projects
that have already received Congressional authorization. Other projects
may be eligible for funding if: (1) a feasibility study is submitted to
the Secretary of the Interior by September 30, 2012; and (2) Congress
authorizes the project's construction after S. 715's enactment.
This funding represents a relatively modest Federal investment,
compared to the increased costs that will likely occur due to
construction delays if funding remains at current levels. We recognize
that there are Federal budget constraints. Nevertheless, such
constraints do not negate the Federal responsibility to complete
authorized rural water projects, particularly those intended to fulfill
in part a solemn Federal promise and trust responsibility to compensate
States and Tribes for lost resources as a result of the construction of
Federal flood control projects.
For example, the Garrison Diversion Unit, an altered version of
which would receive funding under S. 715, is intended to compensate the
State of North Dakota for the loss of over 300,000 acres of prime
farmland that was lost as a result of the construction of the Pick-
Sloan Missouri River Basin Program,\6\ which also inundated over 550
square miles of Native American land and displaced more than 900 Native
American families.\7\ Additionally, the North Central/Rocky Boys rural
water project will implement the tribe's water rights settlement (as
codified in Pub. L. 106-163) with the United States and the State of
Montana.
---------------------------------------------------------------------------
\6\ GARRISON DIVERSION CONSERVANCY DISTRICT, HISTORY & FEDERAL
LEGISLATION: THE PICK-SLOAN MISSOURI BASIN PROGRAM, http://
www.garrisondiv.org/about_us/history_federal_legislation/.
\7\ SENATE REP. NO. 105-146, 4 (1997) (accompanying S. 156 and
describing the impacts of the Pick-Sloan Missouri River Basin Program
on the Lower Brule Sioux Tribe), http://www.gpo.gov/fdsys/pkg/CRPT-
105srpt146/pdf/CRPT-105srpt146.pdf.
---------------------------------------------------------------------------
Authorizing the increased use of Reclamation Fund revenues to
expedite completion of these projects fulfills a financial and moral
obligation that some beneficiaries have waited decades to see honored.
It is also important to note that the Federal expenditures provided
under S. 715 would generate significant and actual returns on this
investment, including but not limited to:
National Economic Impacts: According to a 2008 U.S.
Conference of Mayors report, one dollar invested in water and
sewer infrastructure increases private output, or Gross
Domestic Product, in the long-term by $6.35. Furthermore, for
each additional dollar of revenue generated by the water and
sewer industry, the increase in revenue that occurs in all
industries for that year is $2.62.\8\
---------------------------------------------------------------------------
\8\ THE U.S. CONFERENCE OF MAYORS: MAYORS WATER COUNCIL, LOCAL
GOVERNMENT INVESTMENT IN MUNICIPAL WATER AND SEWER INFRASTRUCTURE:
ADDING VALUE TO THE NATIONAL ECONOMY, i (August 2008), available at:
http://www.usmayors.org/urbanwater/documents/
LocalGovt%20InvtInMunicipalWaterandSewerInfrastructure.pdf.
---------------------------------------------------------------------------
Economic Impacts and Job Creation in Rural Communities:
Investments in rural water projects have a direct impact on the
economies of the communities serviced by those projects. For
example, a 2006 study by HDR, Inc. on the economic impacts of
constructing the Lewis and Clark Rural Water System, which
would be eligible to receive funding under S. 715, found that
the total economic impact to South Dakota, Iowa, and Minnesota
would total $414.4 million. The report also estimates that the
project's construction would directly or indirectly create
7,441 jobs. On a yearly basis, this equals the creation of 532
direct and indirect jobs with average annual salaries ranging
from $25,591 to $33,462. Approximately 72 percent of the
economic impacts would be realized in South Dakota, with 17
percent in Iowa and 11 percent in Minnesota.\9\
---------------------------------------------------------------------------
\9\ HDR, INC., THE ECONOMIC AND FISCAL IMPACTS OF CONSTRUCTING THE
LEWIS AND CLARK RURAL WATER SYSTEM: 2004 STUDY AND 2006 UPDATE, 2 - 3,
63 - 64 (March 2006), available at: http://www.lcrws.org/pdf/
EconomicImpactStudy/EconomicImpactStudy.pdf . See also BUREAU OF
RECLAMATION, supra note 1 at 4 (discussing Federal costs for currently
authorized rural water projects).
---------------------------------------------------------------------------
Improved Potential for Economic Development in Rural Areas:
The economy of every community, especially rural communities,
requires sufficient water supplies of suitable quality. Such
supplies depend upon adequate water infrastructure. Improving
the water infrastructure of the rural and Tribal communities
that would be affected by S. 715 will improve their ability to
attract business and develop their economies in ways that are
not possible with their current water supplies.
Improved Quality of Life: The types of water projects that
would receive funding under S. 715 would meet the same water
quality standards as public systems. These projects would
therefore provide a higher quality of safe drinking water and
associated health benefits than the water supplies upon which
these communities currently rely.
Reduced Costs: Rural communities would no longer need to
expend limited resources drilling and maintained wells,
softening and treating water, or hauling water. In addition,
these communities would see decreased electrical pumping costs.
Rural Fire Protection: Rural water systems provide water
storage that fire trucks can use to assist with rural fire
protection.
Livestock Use:Rural water projects provide a more reliable
and better supply of water for livestock. They also have the
potential to decrease the impacts of livestock grazing on
riparian areas by allowing for the delivery of water away from
these sensitive areas.
Increased Property Values: In some areas, the resale value
of property may increase with a more reliable, safe, clean and
adequate water supply.
IV. THE USE OF THE RECLAMATION FUND UNDER S. 715
Section 3(a) of S. 715 would provide funding for eligible rural
water projects by establishing a Reclamation Rural Water Construction
Fund (RRWCF) within the U.S. Treasury that would be financed from
revenues that would otherwise be deposited in the Reclamation Fund (the
``Fund''). These funds would not be subject to further appropriation,
would be in addition to other amounts appropriated for the authorized
projects, and should not result in corresponding offsets to other
critical Reclamation and Department of the Interior programs. The
Secretary of the Interior would also invest the portion of these
receipts not needed to meet current expenses, and the resulting
interest and proceeds from the sale or redemption of any obligations
would become part of the RRWCF. The RRWCF would terminate in September
2035, at which point its unexpended and unobligated balance would
transfer back to the Fund.
Congress established the Fund when it enacted the Reclamation Act
of 1902 (Pub. L. 57-161) and it was intended to be the principle means
of financing Federal western water and power projects in the 17 western
states. As stated in Section 1 of the Reclamation Act, the Fund
provides monies ``. . .reserved, set aside, and appropriated as a
special fund in the Treasury.''
The Fund's receipts are derived from water and power sales, project
repayments, and receipts from public land sales and leases in the 17
western states, as well as oil and mineral-leasing related royalties.
However, the receipts that accrue to the Fund each year are only
available for expenditure pursuant to annual appropriations acts. Over
the years, rising energy prices and declining Federal expenditures from
the Fund for Reclamation purposes have resulted in an increasingly
large unobligated balance.
According to the Administration's FY 2014 budget request, actual
and estimated appropriations from the Reclamation Fund are $872 million
for FY 2012 and $873 million for FY 2013. While these appropriations
are projected to decrease to $852 million for FY 2014, the Fund's
unobligated balance is expected to grow from an actual balance of $10.8
billion in FY 2012 to an estimated $13.3 billion by the end of FY
2014.\10\ Contrary to Congress' original intent, instead of supporting
western water development, much of the unobligated balance has gone
instead to other Federal purposes.
---------------------------------------------------------------------------
\10\ THE APPENDIX, BUDGET OF THE UNITED STATES GOVERNMENT, FISCAL
YEAR 2014, 631 (April 2013), http://www.whitehouse.gov/sites/default/
files/omb/budget/fy2014/assets/int.pdf.
---------------------------------------------------------------------------
The WSWC has long supported using the Fund for its intended purpose
of financing western water development, including the types of rural
water projects that would receive funding under S. 715. As stated in
WSWC Position #333, Congress and the Administration should:
[F]ully utilize the funds provided through the Reclamation
Act and subsequent acts for their intended purpose in the
continuing conservation, development and wise use of western
resources to meet western water-related needs--recognizing and
continuing to defer to the primacy of western water laws in
allocating water among uses--and work with the States to meet
the challenges of the future.
Unlike typical Congressional authorizations that often do not
specify a funding source and may require more Federal monies in
addition to current authorizations, the RRWCF would rely on the
established stream of receipts and associated interest. Furthermore, as
required by Section 3(b)(3) of S. 715, no amounts may be deposited or
made available to the RRWCF if the transfer or availability of the
amounts would increase the Federal deficit.
It is also important to note that the concept of using receipts
accruing to the Fund to establish a separate account to finance
specific water projects is not new. Specifically, Congress established
the Reclamation Water Settlements Fund (RWSF) under Title X of the
Omnibus Public Lands Management Act of 2009 (Pub .L. 111-11). Like the
RRWCF, the RWSF consists of receipts transferred from the Fund and
provides specified levels of funding starting in FY 2020 for a period
of 10 years to help finance specified water infrastructure projects
that are part of Congressional-authorized water settlements, especially
Indian water rights settlements. The WSWC supports the RWSF for the
same reason it supported the establishment of the RRWCF as proposed in
S. 715--the use of these funds furthers the construction of much needed
water infrastructure in the West in accordance with the Fund's original
intent and purpose.
V. FUNDING PRIORITIZATION UNDER S. 715
Before expenditures from the RRWCF could be made, Section 3(c)(3)
of S. 715 would require the Secretary of the Interior to develop
programmatic goals to ensure that the authorized projects are
constructed as expeditiously as possible, and in a manner that reflects
the goals and priorities of the projects' authorizing legislation and
the Rural Water Supply Act of 2006. The bill would also require the
Secretary to develop funding prioritization criteria that would
consider: (1) the ``urgent and compelling need'' for potable water
supplies in affected communities; (2) the status of the current stages
of completion of a given project; (3) the financial needs of affected
rural and Tribal communities; (4) the potential economic benefits of
the expenditures on job creation and general economic development in
affected communities; (5) the ability of a given project to address
regional and watershed level water supply needs; (6) a project's
ability to minimize water and energy consumption and encourage the
development of renewable energy resources, such as wind, solar, and
hydropower; (7) the needs of Indian tribes and Tribal members, as well
as other community needs or interests; and (8) such other factors the
Secretary deems appropriate.
As the WSWC stated in its June 8, 2012 letter, these programmatic
goals and funding priorities ``. . .should be developed in a
transparent manner in consultation with the affected communities and
States--and should consider existing state water plans and
priorities.'' States and the affected communities have on the ground
knowledge of the facts and circumstances associated with the authorized
projects that would receive funding under S. 715, and are therefore the
most appropriate entities to assist the Secretary in developing these
goals and priorities.
VI. RECLAMATION AND RURAL WATER PROJECTS
Reclamation is well suited to carry out the development and
construction of the authorized rural water projects that would receive
funding under S. 715. These specific projects are already authorized
and under construction by Reclamation, which has a long history of
planning, designing and constructing water infrastructure projects in
the West. Most other existing federal water quality and supply programs
typically provide loans, grants, or loan guarantees. However, many
smaller and poorer rural communities have very limited capacity and
little experience to be able to design and construct water projects
with financial assistance alone. Consequently, they often need the
experience and assistance that Reclamation can provide to help assess
needs, design, plan, and construct large water infrastructure projects.
VII. CONCLUSION
The expedited construction of authorized rural water projects
facilitated by S. 715 will save the Treasury money in the long run, as
costs continue to rise, and fulfill Federal obligations in a more
timely manner, including Federal tribal trust responsibilities.
Postponing spending on this obligation through inadequate or
insufficient funding levels only increases Federal costs and
perpetuates hardships to rural and Tribal communities in the West. S.
715 would not only fulfill solemn Federal obligations, but also provide
needed economic development and job creation.
Importantly, the bill would use receipts that are already accruing
to the Reclamation Fund for their intended purpose of financing the
construction of western water projects.
The WSWC appreciates the opportunity to submit this testimony, and
urges the Committee to approve S. 715 and work with the States towards
its effective implementation.
ATTACHMENT
Western States Water Council,
Murray, UT, June 8, 2012.
Position No. 343.
Hon. Jeff Bingaman,
Chairman, Energy and Natural Resources Committee, U.S. Senate, SD-364
Dirksen Senate Office Building, Washington, DC.
Hon. Lisa Murkowski,
Ranking Member, Energy and Natural Resources Committee, U.S. Senate,
SD-312 Dirksen Senate Office Building, Washington, DC.
Dear Senators:
On behalf of the Western States Water Council, which represents
eighteen states, I am writing to express our support for legislative
action to establish a dedicated funding source for the completion of
federal rural water projects authorized by the Congress for
construction by the Bureau of Reclamation. These projects include
components that benefit both Indian and non-Indian rural communities.
Many of these communities, particularly smaller communities, are
struggling to provide adequate water supplies to meet the needs of
their citizens of a quality consistent with federal mandates.
It is essential that these projects be completed in a timely manner
for the benefit of these communities in fulfillment of long-standing
promises and trust responsibilities, some dating back decades. Another
important consideration is the impact on the federal budget and
economic growth. Accelerated construction scheduling, made possible by
a more timely federal investment of modest amounts, will minimize long-
term federal expenditures and create more jobs now.
With respect to programmatic goals and funding priorities
established pursuant to directives in any legislation, these should be
developed in a transparent manner in consultation with the affected
communities and States--and should consider existing state water plans
and priorities.
We appreciate the opportunity to express our interests and look
forward to working with you to address this important need.
Sincerely,
Phillip C. Ward,
Chairman.