[Senate Report 110-385]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 817
110th Congress                                                   Report
                                 SENATE
 2d Session                                                     110-385

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 MCGEE GREEK PROJECT PIPELINE AND ASSOCIATED FACILITIES CONVEYANCE ACT

                                _______
                                

                 June 16, 2008.--Ordered to be printed

                                _______
                                

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

                              R E P O R T

                        [To accompany H.R. 2085]

    The Committee on Energy and Natural Resources, to which was 
referred the Act (H.R. 2085) to authorize the Secretary of the 
Interior to convey to the McGee Creek Authority certain 
facilities of the McGee Creek Project, Oklahoma, and for other 
purposes, having considered the same, reports favorably thereon 
without amendment and recommends that the Act do pass.

                         PURPOSE OF THE MEASURE

    The purpose of H.R. 2085 is to authorize the Secretary of 
the Interior to convey to the McGee Creek Authority certain 
facilities of the McGee Creek Project, Oklahoma, and for other 
purposes.

                          BACKGROUND AND NEED

    The McGee Creek Project, near Atoka, Oklahoma, was 
authorized in Title VII of the Reclamation Authorizations Act 
of 1976 for the purpose of storing, regulating, and conveying 
water for municipal and industrial use. Oklahoma City, Soda, 
Atoka County, and the City of Atoka are provided with a 
supplemental municipal and industrial water supply from the 
McGee Project.
    The McGee Creek Authority (Authority) was established to 
develop, finance, operate, and maintain the water supply in the 
McGee Creek Reservoir. The Authority became responsible for the 
operation and maintenance of the project on September 1, 1990. 
Section 205(a) of Public Law 101-514 authorized the Secretary 
to enter into a contract with the McGee Creek Authority to 
accept final payment of the original repayment obligation for 
the McGee Creek Project. Section 205(c) specifically states 
that the title to the McGee Creek project facilities shall 
remain with the United States even if the repayment obligation 
has been satisfied. The Authority's repayment obligation was 
satisfied on October 30, 1992, with a final payment of 
$88,600,000. The Authority is still obligated to pay or provide 
for the operation and maintenance of the project.
    H.R. 2085 would transfer ownership of certain facilities of 
the McGee Creek Project, currently held by the United States 
through the Bureau of Reclamation, to the McGee Creek 
Authority. The title transfer includes 23.83 acres of land, 17 
miles of raw water pipeline, all control structures and related 
appurtenances, as well as the Rate of Flow Control Station at 
Lake Atoka. This transfer does not include the Dam or 
Reservoir.
    In April 2006, a Memorandum of Agreement (MOA) was signed 
by the Bureau of Reclamation and the Authority in which they 
agreed to seek legislation to authorize transfer of facilities 
to the Authority. The MOA also outlined the responsibilities of 
the Bureau and the Authority, including payment agreements.

                          LEGISLATIVE HISTORY

    H.R. 2085 was introduced by Rep. Mary Fallin on May 1, 2007 
and referred to the Committee on Natural Resources. Rep. Dan 
Boren is a co-sponsor of the bill. Under suspension of the 
rules, H.R. 2085 passed the House of Representatives on 
December 6, 2007, and was referred to the Committee on Energy 
and Natural Resources. A companion measure, S. 177 was 
introduced by Senator Inhofe on January 4, 2007 and referred to 
the Committee on Energy and Natural Resources. On February 28, 
2008, the Subcommittee on Water and Power of the Senate 
Committee on Energy and Natural Resources held a hearing on S. 
177 and H.R. 2085. At its business meeting on May 7, 2008, the 
Committee on Energy and Natural Resources ordered H.R. 2085 
favorably reported.

                        COMMITTEE RECOMMENDATION

    The Committee on Energy and Natural Resources, in open 
business session on May 7, 2008, by voice vote of a quorum 
present, recommends that the Senate pass H.R. 2085.

                      SECTION-BY-SECTION ANALYSIS

    Section 1 provides the short title of the Act.
    Section 2 defines terms used in the Act.
    Section 3(a) authorizes the Secretary, in accordance with 
applicable law and the MOA, to convey certain specified 
facilities to the Authority, but excludes the mineral estate 
from the conveyance.
    Section 3(b) requires the Authority to comply with all 
applicable laws upon conveyance of the identified facilities, 
to assume all responsibility for operation and maintenance 
costs, and limits the Authority's eligibility for certain 
identified funding.
    Section 3(c) limits the United States liability for damages 
associated with the land and facilities being conveyed.
    Section 3(d) specifies that an existing Contract between 
the Authority and the United States shall remain in effect, 
except as authorized to be amended.
    Section 3(e) continues the application of the reclamation 
laws to project water provided to the Authority.

                   COST AND BUDGETARY CONSIDERATIONS

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

H.R. 2085--McGee Creek Project Pipeline and Associated Facilities 
        Conveyance Act

    H.R. 2085 would authorize the Secretary of the Interior to 
convey a pipeline and associated water facilities to the McGee 
Creek Authority of Oklahoma City, Oklahoma. The Authority would 
be responsible for all operation and maintenance costs of the 
pipeline and facilities after the conveyance.
    CBO estimates that implementing H.R. 2085 would have no 
significant effect on the federal budget. The Authority has 
repaid the federal government its obligation for building the 
pipeline and related facilities. Under the act, any 
administrative costs to the federal government for conveying 
the facilities would be paid by the McGee Creek Authority. 
Enacting H.R. 2085 would not affect direct spending or 
revenues.
    H.R. 2085 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments. 
The state of Oklahoma and certain local governments would 
benefit from the conveyances authorized in this act. Any costs 
to those governments would be incurred voluntarily.
    On November 28, 2007, CBO transmitted a cost estimate for 
H.R. 2085, the McGee Creek Project Pipeline and Associated 
Facilities Conveyance Act, as ordered reported by the House 
Committee on Natural Resources on November 15, 2007. The 
versions of the legislation are identical, as are the estimated 
costs.
    The CBO staff contact for this estimate is Tyler Kruzich. 
This estimate was approved by Theresa Gullo, 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 H.R. 2085. 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 program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of H.R. 2085, as ordered reported.

                   CONGRESSIONALLY DIRECTED SPENDING

    H.R. 2085, as reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined by rule XLIV of the 
Standing Rules of the Senate.

                        EXECUTIVE COMMUNICATIONS

    The testimony provided by the Bureau of Reclamation at the 
Senate Committee on Energy and Natural Resources subcommittee 
hearing on companion measure S. 177 follows:

    Statement of Robert J. Quint, Director of Operations, Bureau of 
              Reclamation, U.S. Department of the Interior

    Mr. Chairman and members of the Subcommittee, I am Robert 
J. Quint, Director of Operations for the Bureau of Reclamation. 
I am pleased to appear before this Subcommittee to provide 
testimony on S. 177, legislation to authorize the Secretary of 
the Interior to convey certain lands and facilities of the 
McGee Creek Project in Oklahoma to the McGee Creek Authority 
(Authority). The Administration supports this bill and we thank 
the committee for considering it today.
    The Department of the Interior has an active title transfer 
program and supports transferring ownership of certain 
Reclamation project facilities to non-Federal entities. Initial 
discussions on this transfer began in 1997, and Reclamation and 
the McGee Creek Authority have been working collaboratively to 
lay the groundwork for this title transfer since that time. 
Reclamation and the Authority entered into a Memorandum of 
Agreement (MOA) in 1998 for the purpose of defining the 
activities and responsibilities necessary to move forward with 
the proposed transfer. Before the transfer could be finalized 
and the necessary legislation could be proposed, the agreement 
expired in September 2002. In 2006, the Authority again 
expressed interest in the transfer and in April of that year, a 
new MOA was executed.
    Through cooperative efforts with the Authority, all 
elements required by Reclamation for title transfer have been 
successfully addressed for the McGee Creek project. The 
Authority has provided funding for Reclamation to complete the 
necessary environmental, legal, and historic preservation 
documentation for this transfer, including a Final 
Environmental Assessment and Finding of No Significant Impact, 
concurrence from the State Historic Preservation Officer, a 
hazardous materials clearance, and conveyance documents.
    The costs of the lands, buildings and facilities to be 
transferred have already been repaid pursuant to the 
Authority's original repayment contract. All of the lands to be 
transferred were acquired by Reclamation when the project was 
built and the original repayment contract incorporated 
acquisition costs together with the costs associated with the 
construction of the project facilities and associated 
easements, lands and buildings. There are no ongoing revenue 
streams associated with these lands and facilities. As such, no 
additional payment for this transfer is required.
    In addition, this title transfer protects the financial 
interest of the United States. Transferring title to these 
facilities will reduce a number of administrative burdens on 
Reclamation including periodic facility reviews that are 
currently required because it is a Reclamation owned facility, 
and the processing of paperwork that currently consumes 
significant staff time. It will also ensure that long term 
responsibility for the operation, maintenance, management, and 
regulation, as well as liability, for the transferred lands and 
facilities will rest with the Authority.
    Again, we support passage of S. 177 and thank the 
subcommittee for holding this hearing. It reflects a 
cooperative and cost effective process that will provide a 
benefit to the Authority and Reclamation.
    This concludes my testimony and I would be pleased to 
answer any questions.

                        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 the bill H.R. 2085, as 
ordered reported.

                                  
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