[Senate Report 105-290]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 527
105th Congress                                                   Report
                                 SENATE

 2d Session                                                     105-290
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                   HYDROELECTRIC PROJECT IN ARKANSAS

                                _______
                                

                August 25, 1998.--Ordered to be printed

   Filed under authority of the order of the Senate of July 31, 1998

_______________________________________________________________________


  Mr. Murkowski, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 2171]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 2171) to extend the deadline under the 
Federal Power Act applicable to the construction of a 
hydroelectric project in the State of Arkansas, having 
considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                         purpose of the measure

    The purpose of S. 2171 is to extend the deadline contained 
in the Federal Power Act for the commencement of construction 
of a FERC-licensed hydroelectric project (No. 10455) located in 
the State of Arkansas.

                          background and need

    Section 13 of the Federal Power Act requires a licensee to 
commence the construction of the hydroelectric project within 
two years of the date of the issuance of the license. That 
deadline can be extended by the FERC one time for as much as 
two additional years. If construction has not commenced by the 
end of the time period, the license is terminated by the FERC. 
Thus, in the absence of this legislation, the FERC would 
terminate the license for project No. 10455 at the end of the 
time period authorized under the Federal Power Act for 
commencement of construction.
    On occasion a licensee may have difficulty obtaining a 
power sales contract, and until that is obtained the licensee 
cannot secure the financing necessary to commence construction. 
If the license is terminated, to continue the project the 
licensee would have to undergo the time and expense of 
obtaining a new license, which is considerable.
    S. 2171 would authorize the FERC, upon the request of the 
licensee, to extend the time required for commencement of 
construction for not more than 3 consecutive 2-year periods.

                          legislative history

    S. 2171 was introduced on June 16, 1998. No hearing was 
held.

            committee recommendation and tabulation of votes

    The Senate Committee on Energy and Natural Resources, in 
open business session on July 29, 1998, by a voice vote with a 
quorum present, unanimously recommends that the Senate pass the 
bill without amendment.

                   cost and budgetary considerations

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, July 30, 1998.
Hon. Frank H. Murkowski,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 2171, a bill to 
extend the deadline under the Federal Power Act applicable to 
the construction of a hydroelectric project in the state of 
Arkansas.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact for this 
estimate is Kim Cawley.
            Sincerely,
                                         June E. O'Neill, Director.
    Enclosure.

S. 2171.--A bill to extend the deadline under the Federal Power Act 
        applicable to the construction of a hydroelectric project in 
        the state of Arkansas

    CBO estimates that enacting S. 2171 would have no net 
effect on the federal budget. The bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act of 1995 and would not affect the 
budgets of state, local, or tribal governments.
    S. 2171 would extend for up to six years the deadline for 
constructing a hydroelectric project currently subject to 
licensing by the Federal Energy Regulatory Commission (FERC). 
The proposed extension is for FERC project number 10455. This 
provision may have a minor impact on FERC's workload. Because 
FERC recovers 100 percent of its costs through user fees, any 
change in its administrative costs would be offset by an equal 
change in the fees that the commission charges. Hence, the 
provision would have no net budgetary impact.
    Because FERC's administrative costs are limited in annual 
appropriations, enactment of this legislation would not affect 
direct spending or receipts. Therefore, pay-as-you-go 
procedures would not apply.
    The CBO staff contact for this estimate is Kim Cawley. This 
estimate was approved by Robert A. Sunshine, Deputy Assistant 
Director for Budget Analysis.

                      regulatory impact evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out this measure.
    The bill is not a regulatory measure in the sense of 
imposing Government-established standards or significant 
economic responsibilities on private individuals and 
businesses.
    No personal information would be collected in administering 
the provisions of the bill. Therefore, there would be no impact 
on personal privacy.
    Little, if any, additional paperwork would result from the 
enactment of this measure.

                        executive communications

    The pertinent communications received by the Committee from 
the Federal Energy Regulatory Commission setting forth 
Executive agency relating to this measure are set forth below:

                      Federal Energy Regulatory Commission,
                                     Washington, DC, July 31, 1998.
Hon. Frank H. Murkowski,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: Thank you for your July 30, 1998, 
request for comments on S. 2171, an act to extend the 
construction deadlines applicable to a hydroelectric project 
licensed by the Federal Energy Regulatory Commission.
    Section 13 of the Federal Power Act requires that 
construction of a licensed project be commenced within two 
years of issuance of the license. Section 13 authorizes the 
Commission to extend this deadline once, for a maximum 
additional two years. If project construction has not commenced 
by this deadline, the Commission is required to terminate the 
license. Section 13 also authorizes the Commission to extend 
the deadline for completion of construction when not 
incompatible with the public interest.
    On October 17, 1994, the Commission issued a license to JDJ 
Energy Company to construct and operate the 600-megawatt River 
Mountain Pumped Storage Project No. 10455, to be located at the 
Corps of Engineers' Dardenelle Lock and Dam on the Arkansas 
River in Logan County, Arkansas. The original deadline for the 
commencement of project construction, October 16, 1996, was 
extended by the Commission to October 16, 1998.
    S. 2171 would authorize the Commission, upon the request of 
the licensee, after reasonable notice, and in accordance with 
the good faith, due diligence, and public interest requirements 
of section 13, to extend the deadline for commencement of 
construction for three consecutive 2-year periods.
    The Commission has not objected to bills granting a 
licensee up to 10 years from the issuance date of the license 
to commence project construction. Since the deadline in S. 2171 
does not exceed 10 years, I do not object to the bill's 
enactment.
            Sincerely,
                                        James J. Hoecker, Chairman.

                        changes in existing law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by S. 2171, as ordered 
reported.