[House Report 107-368]
[From the U.S. Government Publishing Office]



107th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     107-368

======================================================================



 
                    LEASE LOT CONVEYANCE ACT OF 2002

                                _______
                                

 March 7, 2002.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Hansen, from the Committee on Resources, submitted the following

                              R E P O R T

                        [To accompany H.R. 706]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Resources, to whom was referred the bill 
(H.R. 706) to direct the Secretary of the Interior to convey 
certain properties in the vicinity of the Elephant Butte 
Reservoir and the Caballo Reservoir, New Mexico, having 
considered the same, report favorably thereon with an amendment 
and recommend that the bill as amended do pass.
  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Lease Lot Conveyance Act of 2002''.

SEC. 2. FINDINGS.

  The Congress finds that the conveyance of the Properties to the 
Lessees for fair market value would have the beneficial results of--
          (1) eliminating Federal payments in lieu of taxes and 
        associated management expenditures in connection with the 
        Government's ownership of the Properties, while increasing 
        local tax revenues from the new owners;
          (2) sustaining existing economic conditions in the vicinity 
        of the Properties, while providing the new owners of the 
        Properties the security to invest in permanent structures and 
        improvements; and
          (3) adding needed jobs to the county in which the Properties 
        are located and increasing revenue to the county and 
        surrounding communities through property and gross receipt 
        taxes, thereby increasing economic stability and a sustainable 
        economy in one of the poorest counties in New Mexico.

SEC. 3. DEFINITIONS.

  In this Act:
          (1) Fair market value.--The term ``fair market value'' means, 
        with respect to a parcel of property, the value of the property 
        determined--
                  (A) without regard to improvements constructed by the 
                Lessee of the property;
                  (B) by an appraisal in accordance with the Uniform 
                Standards for Federal Land Acquisitions; and
                  (C) by an appraiser approved by the Secretary and the 
                purchaser.
          (2) Irrigation districts.--The term ``Irrigation Districts'' 
        means the Elephant Butte Irrigation District and the El Paso 
        County Water Improvement District No. 1.
          (3) Lessee.--The term ``Lessee'' means the leaseholder of a 
        Property on the date of enactment of this Act, and any heir, 
        executor, or assign of the leaseholder with respect to that 
        leasehold interest.
          (4) Property.--The term ``Property'' means any of the cabin 
        sites comprising the Properties.
          (5) Properties.--The term ``Properties'' means all the real 
        property comprising 403 cabin sites under the administrative 
        jurisdiction of the Bureau of Reclamation that are located 
        along the western portion of the reservoirs in Elephant Butte 
        State Park and Caballo State Park, New Mexico, including 
        easements, roads, and other appurtenances. The exact acreage 
        and legal description of such real property shall be determined 
        by the Secretary after consulting with the Purchaser.
          (6) Purchaser.--The term ``Purchaser'' means the Elephant 
        Butte/Caballo Leaseholders Association, Inc., a nonprofit 
        corporation established under the laws of New Mexico.
          (7) Reservoirs.--The term ``reservoirs'' means the Elephant 
        Butte Reservoir and the Caballo Reservoir in the State of New 
        Mexico.
          (8) Secretary.--The term ``Secretary'' means the Secretary of 
        the Interior.

SEC. 4. CONVEYANCE OF PROPERTIES.

  (a) In General.--The Secretary shall convey to the Purchaser in 
accordance with this Act, subject to valid existing rights, all right, 
title, and interest of the United States in and to the Properties and 
all appurtenances thereto, including specifically easements for--
          (1) vehicular access to each Property;
          (2) drainage; and
          (3) access to and the use of all ramps, retaining walls, and 
        other improvements for which access isprovided under the leases 
that apply to the Properties as of the date of the enactment of this 
Act.
  (b) Consideration.--As consideration for any conveyance under this 
section, the Secretary shall require the Purchaser to pay to the United 
States fair market value of the Properties.

SEC. 5. TERMS OF CONVEYANCE.

  (a) Specific Conditions.--As conditions of any conveyance to the 
Purchaser under this Act, the Secretary shall require the following:
          (1) Leaseholders' option.--The Purchaser shall grant to each 
        Lessee of a Property an option--
                  (A) to purchase the Property at fair market value; or
                  (B) to continue leasing the Property on terms to be 
                negotiated with the Purchaser.
          (2) Administrative costs.--Any reasonable administrative cost 
        incurred by the Secretary incident to the conveyance under 
        section 6 shall be reimbursed by the Purchaser.
  (b) Restrictive Use Covenant.--
          (1) In general.--To maintain the unique character of the area 
        in the vicinity of the Reservoirs, the Secretary shall 
        establish, by the terms of conveyance, use restrictions to 
        carry out paragraph (2) that--
                  (A) are appurtenant to, and run with, each Property; 
                and
                  (B) are binding upon each subsequent owner of each 
                Property.
          (2) Access to reservoirs.--The use restrictions required by 
        paragraph (1) shall ensure that--
                  (A) public access to and along the shoreline of the 
                Reservoirs in existence on the date of enactment of 
                this Act is not obstructed;
                  (B) adequate public access to and along the shoreline 
                of the Reservoirs is maintained; and
                  (C) the operation of the Reservoirs by the Secretary 
                or the Irrigation Districts shall not result in 
                liability of the United States or the Irrigation 
                Districts for damages incurred, as a direct or indirect 
                result of such operation, by the owner of any Property 
                conveyed under this Act, including--
                          (i) damages for any loss of use or enjoyment 
                        of a Property; and
                          (ii) damages resulting from any modifications 
                        or construction of any reservoir dam.
  (c) Timing.--
          (1) In general.--The Secretary shall convey the Properties 
        under this Act as soon as practicable after the date of 
        enactment of this Act and in accordance with all applicable 
        law.
          (2) Report.--If the Secretary has not completed conveyance of 
        the Properties to the Purchaser by the end of the 1-year period 
        beginning on the date of the enactment of this Act, the 
        Secretary shall, before the end of that period, submit a report 
        to the Congress explaining the reasons that conveyance has not 
        been completed and stating the date by which the conveyance 
        will be completed.
  (d) Reimbursement of Purchaser's Costs.--The terms of conveyance 
shall authorize the Purchaser to require each Lessee to reimburse the 
Purchaser for a proportionate share of the costs incurred by the 
Purchaser in completing the transactions pursuant to this Act, 
including any interest charges.

SEC. 6. RESOLUTION OF CLAIMS AND DISPUTES.

  After conveyance of the Properties to the Purchaser, if any Lessee 
has a dispute with or claim against the Purchaser or any of its 
officers, directors, or members arising from the Properties, the Lessee 
shall promptly give written notice of the dispute or claim to the 
Purchaser. If such notice is not provided to the Purchaser within 20 
days after the date the Lessee knew or should have known of such 
dispute or claim, then any right of the Lessee for relief based on such 
dispute or claim shall be waived. If the Lessee and the Purchaser are 
unable to resolve the dispute or claim by mediation, the dispute or 
claim shall be resolved by binding arbitration.

SEC. 7. FEDERAL RECLAMATION LAW.

  No conveyance under this Act shall restrict or limit the authority or 
ability of the Secretary to fulfill the duties of the Secretary under 
the Act of June 17, 1902 (32 Stat. 388, chapter 1093), and Acts 
supplemental to and amendatory of that Act (43 U.S.C. 371 et seq.).

                          PURPOSE OF THE BILL

    The purpose of H.R. 706, is to direct the Secretary of the 
Interior to convey certain properties in the vicinity of the 
Elephant Butte Reservoir and the Caballo Reservoir, New Mexico.

                  BACKGROUND AND NEED FOR LEGISLATION

    In the 1930s the lease lot program at Elephant Butte and 
Caballo Reservoirs began where the Bureau of Reclamation leased 
parcels of land surrounding the two reservoirs. Under the terms 
of the lease, significant improvements to the land had to be 
made before renewal could take place. Leaseholders made these 
improvements including the building of homes. The lease holders 
made these improvements because they were under the impression 
that someday they would be able to buy the property from the 
Bureau of Reclamation. Privatization of this land has been the 
plan of many such leaseholders.
    This proposed transfer in H.R. 706 culminates several years 
of effort by the interested parties, the Bureau of Reclamation 
and Congress to address all issues related to the transfer.
    The Committee expects that the costs associated with the 
surveys and appraisals required for the determination of fair 
market value will be included in the administrative costs 
described in section 5(a)(2) of the bill.

                            COMMITTEE ACTION

    H.R. 706 was introduced on February 14, 2001, by 
Congressman Joe Skeen (R-NM). The bill was referred to the 
Committee on Resources, and within the Committee to the 
Subcommittee on Water and Power. On December 10, 2001, the 
Subcommittee held a field hearing on the bill in Las Vegas, 
Nevada. On February 14, 2002, the Subcommittee met to mark up 
the bill. Congressman Ken Calvert (R-CA) offered an amendment 
in the nature of a substitute to clarify where the proceeds of 
the sale will be credited and how the fair market value will be 
determined. The amendment also provided a date by which the 
transfer shall be completed, or require a report to Congress if 
the Administration cannot complete the transfer in a timely 
manner. The Calvert amendment was adopted by unanimous consent. 
The bill as amended was then ordered favorably reported to the 
Full Committee by unanimous consent. On February 26, 2002, the 
Full Resources Committee met to consider the bill. Congressman 
Calvert offered an amendment to clarify that the Secretary of 
the Interior and the purchaser will select the appraiser. The 
amendment was adopted by unanimous consent. The bill, as 
amended, was then ordered favorably reported to the House of 
Representatives by unanimous consent.

            COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII of the Rules of the House of Representatives, the 
Committee on Resources' oversight findings and recommendations 
are reflected in the body of this report.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Article I, section 8 of the Constitution of the United 
States grants Congress the authority to enact this bill.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. Cost of Legislation. Clause 3(d)(2) of rule XIII of the 
Rules of the House of Representatives requires an estimate and 
a comparison by the Committee of the costs which would be 
incurred in carrying out this bill. However, clause 3(d)(3)(B) 
of that rule provides that this requirement does not apply when 
the Committee has included in its report a timely submitted 
cost estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 402 of the 
Congressional Budget Act of 1974.
    2. Congressional Budget Act. As required by clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives and 
section 308(a) of the Congressional Budget Act of 1974, this 
bill does not contain any new budget authority, spending 
authority, credit authority, or an increase or decrease in 
expenditures. According to the Congressional Budget Office, 
enactment of H.R. 706 will result in additional receipts of $20 
million over the 2003-2007 period.
    3. General Performance Goals and Objectives. This bill does 
not authorize funding and therefore, clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives does not 
apply.
    4. Congressional Budget Office Cost Estimate. Under clause 
3(c)(3) of rule XIII of the Rules of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the Committee has received the following cost estimate 
for this bill from the Director of the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                     Washington, DC, March 5, 2002.
Hon. James V. Hansen,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 706, the Lease Lot 
Conveyance Act of 2001.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Julie 
Middleton (for the federal costs), and Marjorie Miller (for the 
state and local impact).
            Sincerely,
                                        Steven M. Lieberman
                                    (For Dan L. Crippen, Director).
    Enclosure.

----------------------------------------------------------------------------------------------------------------
                                                                  By fiscal year, in millions of dollars--
                                                           -----------------------------------------------------
                                                              2002     2003     2004     2005     2006     2007
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING

Estimated Budget Authority................................        0        0      -20        0        0        0
Estimated Outlays.........................................        0        0      -20        0        0        0
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: For this estimate, CBO assumes that H.R. 
706 will be enacted in fiscal year 2002 and that the conveyance 
of the properties will occur in 2004. According to both the 
Elephant Butte/Caballo Leaseholders Association and the Bureau 
of Reclamation, it will take at least one year to survey and 
appraise the property before the land would convey.
    Based on information provided by the Bureau of Reclamation, 
CBO estimates that the association would purchase the property 
including easements and roads from the federal government for 
about $40,000 to $60,000 per lot, for a total of about $20 
million for the 403 cabin sites.
    Currently, these properties do not generate any receipts 
for the federal government. The state of New Mexico manages the 
property for recreation and leases the cabin sites to 
individuals for temporary occupancy. The state uses the revenue 
generated from the leases for administration and management of 
the cabin sites and other types of park operations.
    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending or receipts. The net 
changes in outlays that are subject to pay-as-you-go procedures 
are shown in the following table. For the purposes of enforcing 
pay-as-you-go procedures, only the effects through 2006 are 
counted.

----------------------------------------------------------------------------------------------------------------
                                                      By fiscal year, in millions of dollars--
                                   -----------------------------------------------------------------------------
                                     2002   2003   2004    2005   2006   2007   2008   2009   2010   2011   2012
----------------------------------------------------------------------------------------------------------------
Changes in outlays................      0      0     -20      0      0      0      0      0      0      0      0
Changes in receipts...............                                 Not applicable
----------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: H.R. 706 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The state of New Mexico manages these leases 
and retains the lease payments to cover their costs. Should the 
property be sold, the state would lose the lease income, but 
also would benefit from reduced costs. The net impact on the 
state probably would not be substantial.
    Estimate prepared by: Federal Costs: Julie Middleton. 
Impact on State, Local, and Tribal Governments: Majorie Miller. 
Impact on the Private Sector: Lauren Marks.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                    COMPLIANCE WITH PUBLIC LAW 104-4

    This bill contains no unfunded mandates.

                PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

    This bill is not intended to preempt any State, local or 
tribal law.

                        CHANGES IN EXISTING LAW

    If enacted, this bill would make no changes in existing 
law.

                                  
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