[Congressional Record Volume 152, Number 67 (Thursday, May 25, 2006)]
[Senate]
[Page S5256]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. FEINSTEIN:
  S. 3189. A bill to allow for renegotiating of the payment schedule of 
contracts between the Secretary of the Interior and the Redwood Valley 
Country Water District, and for other purposes; to the Committee on 
Energy and Natural Resources.
  Mrs. FEINSTEIN. Mr. President, I rise today to introduce the Redwood 
Valley County Water District Loan Renegotiation Act of 2006.
  This legislation seeks to implement prior congressional action taken 
in 1988 to require the Secretary of the Interior to renegotiate debts 
owed by the Redwood Valley County Water District to the United States. 
It is an absolutely essential step if the Redwood County is to obtain a 
firm and reliable water supply.
  In 1983, the Redwood Valley County Water District completed a project 
to supply water to a rural agricultural community near Ukiah, in 
Northern California. Two Bureau of Reclamation loans totaling $7.3 
million partially financed this project.
  Unfortunately, the District was unable to repay these loans. This 
occurred for several reasons: The initial use projections developed by 
the District and reviewed by the Bureau were seriously flawed; the 
District's ability to raise funds was restricted when a moratorium on 
new hook-ups was imposed; and concerns for endangered species reduced 
the District's water allotment by 15 percent.
  As a result of this situation, in 1998 Congress passed Section 15 of 
Public Law 100-516 that indefinitely suspended the District's 
obligations to repay these Bureau loans and ordered the Secretary of 
Interior to renegotiate the terms of the loans. This loan renegotiation 
has never taken place and now the District finds its water supply 
highly uncertain. The Bureau of Reclamation acknowledged in a 2000 
report that the District needs a reliable water supply in order to 
solve its current financial dilemma.
  The District has recently identified two potential new projects, 
either of which could supply a firm and reliable source. No government 
funds will be sought for these projects, and the District will rely on 
private financing, a strategy that the Bureau is encouraging. However, 
before the District can secure private financing for new projects, it 
must renegotiate the existing loans to provide for their repayment 
subsequent to repayment of the new loans.
  This legislation requires the District to repay the United States the 
currently suspended loans once the new loans have been repaid. The new 
water project will provide enough revenue to allow the District to 
repay both its private loan and the United States government. By 
providing a workable and reasonable solution to a longstanding problem, 
the legislation creates a win-win solution for the Bureau of 
Reclamation and the Redwood Valley County Water District.
  I urge my colleagues to support this bill. I ask unanimous consent 
that the text of the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3189

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. RENEGOTIATION OF PAYMENT SCHEDULE.

       Section 15 of Public Law 100-516 (102 Stat. 2573) is 
     amended as follows:
       (1) By amending paragraph (2) of subsection (a) to read as 
     follows:
       ``(2) If, as of January 1, 2006, the Secretary of the 
     Interior and the Redwood Valley County Water District have 
     not renegotiated the schedule of payment, the District may 
     enter into such additional non-Federal obligations as are 
     necessary to finance procurement of dedicated water rights 
     and improvements necessary to store and convey those rights 
     to provide for the District's water needs. The renegotiated 
     schedule of payments shall commence when which additional 
     obligations have been financially satisfied by the District. 
     The date of the initial payment owed by the District to the 
     United States shall be regarded as the start of the 
     District's repayment period and the time upon which any 
     interest shall first be computed and assessed under section 5 
     of the Small Reclamation Projects Act of 1956 (43 U.S.C. 422a 
     et seq.).''.
       (2) By striking subsection (c).
                                 ______