[Federal Register Volume 68, Number 73 (Wednesday, April 16, 2003)]
[Notices]
[Pages 18621-18626]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-9325]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Collections from Central Valley Project Power Contractors to 
Carry Out the Restoration, Improvement, and Acquisition of 
Environmental Habitat Provisions of the Central Valley Project 
Improvement Act of 1992

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of final procedures.

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SUMMARY: The Western Area Power Administration (Western), by 
publication of this notice, announces final procedures for the 
collection of the Restoration Fund. Western published the proposed 
procedures in the Federal Register on October 29, 2002. Included in 
this notice is a discussion of the comments on the proposed procedures. 
These procedures supersede the procedures published in the Federal 
Register on August 4, 1998.

DATES: The final procedures will become effective January 1, 2005, and 
will remain in effect until superseded.

ADDRESSES: Information regarding the final procedures, including 
comments, letters, and other supporting documents made or kept by 
Western to develop these final procedures, is available for public 
inspection and copying at the Sierra Nevada Region Office, Western Area 
Power Administration, 114 Parkshore Drive, Folsom, CA 95630-4710.

FOR FURTHER INFORMATION CONTACT: Ms. Melinda C. Grow, Public Utilities 
Specialist, Rates Division, Sierra Nevada Customer Service Region, 
Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 
95630-4710, telephone (916) 353-4443, e-mail [email protected].

SUPPLEMENTARY INFORMATION: Section 3407 of the Central Valley Project 
Improvement Act (CVPIA) (Pub. L. 102-575, Stat. 4706, 4726) establishes 
in the Treasury of the United States the Central Valley Project (CVP) 
Restoration Fund (Restoration Fund) to carry out the habitat 
restoration, improvement, and acquisition provisions of the CVPIA. The 
CVPIA further requires the Secretary of the Interior to assess and 
collect annual mitigation and restoration payments from CVP Water and 
Power Contractors (Restoration Payments). The Secretary of the 
Interior, through the Bureau of Reclamation (Reclamation), is 
responsible for determining and collecting CVP Water and Power 
Contractors' share of the annual Total Restoration Fund Payment 
Obligation.
    Because Western markets and transmits CVP power and maintains all 
CVP power contracts, Western agreed to collect the Restoration Payments 
from CVP Power Contractors. Western executed a letter of agreement with 
Reclamation to establish procedures for depositing collections from CVP 
Power Contractors into the Restoration Fund.
    Through an open and public process, the existing procedures became 
effective on September 3, 1998, and remain in effect until superseded 
(63 FR 41561, August 4, 1998). Western indicated that it would review 
the procedures associated with the assessment and collection of the 
Restoration Payments from CVP Power Contractors every 5 years or if one 
of the following occurs: (1) If there is a significant change to or 
suspension of the legislation, (2) if a material issue arises, (3) if 
an apparent inequity in the procedures is discovered, or (4) if any 
significant change occurs that affects the procedures.
    Western published a new marketing plan (2004 Power Marketing Plan) 
in the Federal Register on June 25, 1999. The 2004 Power Marketing Plan 
specifies the terms and conditions under which Western will market 
power from CVP and the Washoe Project beginning January 1, 2005 (64 FR 
34417). Since the current method to assess and collect Restoration Fund 
payments from CVP Power Contractors is tied to the 1994 Marketing Plan 
(57 FR 45782, October 5, 1992) and long-term firm CVP power contracts 
will expire on December 31, 2004, it is necessary to change the method 
of assessing and collecting Restoration Payments from CVP Power 
Contractors.
    Western will prorate and assess to CVP Power Contractors the annual 
Power Restoration Payment Obligation (PRPO), as determined by 
Reclamation. Western will issue each CVP Power Contractor a monthly 
Restoration Fund Bill reflecting its share of the PRPO. The CVP Power 
Contractors will pay that amount to Western. Western will transfer all 
amounts collected from CVP Power Contractors to Reclamation for deposit 
into the Restoration Fund.

Public Notice and Comment

    Summarized below is the process Western used to ensure involvement 
of interested parties in the development of the final procedures for 
the assessment and collection of Restoration Fund payments from CVP 
Power Contractors.
    1. Western published a notice in the Federal Register (67 FR 65974) 
on October 29, 2002. This notice officially announced the proposed 
procedures, initiated the public consultation and comment period, and 
announced the public information and comment forums.
    2. Western sent letters on November 1, 2002, to all CVP preference 
customers and interested parties transmitting the Federal Register 
notice dated October 29, 2002, and announcing the times and locations 
for two public forums.
    3. Western held public information and comment forums on November 
20, 2002, at its Sierra Nevada Region office in Folsom, California. At 
the public information forum, Western explained the proposed procedures 
and answered questions. Western held the public comment forum after the 
public information forum to give the public the opportunity to comment 
for the record. Three representatives from the following organizations 
made oral comments.

Northern California Power Agency (California).
Navigant Consulting Inc., on behalf of the Sacramento Municipal Utility 
District (California).
City of Palo Alto (California).

    4. Western received six comment letters during the public 
consultation and comment period. Western reviewed and considered all 
comments received by the end of the public consultation and comment 
period, December 30, 2002, in developing the final procedures.
    Western received written comments from the following organizations:

Sacramento Municipal Utility District (California).
Northern California Power Agency (California).
Tuolumne Public Power Agency (California).
Calaveras Public Power Agency (California).
Silicon Valley Power--City of Santa Clara (California).

[[Page 18622]]

Trinity Public Utility District (California).

    Below are the paraphrased comments Western received and Western's 
responses to those comments. Specific comments are used for 
clarification when necessary.

A. Definition and Usage of the Terms

    Comment: There was some confusion with respect to the definition 
and usage of the term ``Total Power Restoration Fund Payment 
Obligation'' as articulated in the proposed procedures. The definition 
intended to describe the payments collected from both Water and Power 
Contractors and yet the definition title only included power. Further, 
the use of this term confuses the meaning of the first section of the 
proposed procedures as to when Western is referring to the Water and 
Power contractors. The commentor requested clarification on the use of 
this term.
    Response: Western evaluated the use of this term throughout the 
proposed procedures. The definition, as well as the usage of this term, 
was changed to clarify its usage and is reflected in the final 
procedures.
    Comment: The commentor requested the inclusion of the ancillary 
service, regulation, in the definition of the Base Resource. Western 
should consider defining the Base Resource as only those resources that 
produce power from CVP and Washoe operations, as well as the Enron 
contract, and that no other products will be considered as part of the 
2004 Power Marketing Plan Base Resource.
    Response: The 2004 Marketing Plan (64 FR 34417) as well as the Base 
Resource Contracts have consistently defined the Base Resource `` * * * 
as the CVP and Washoe Project power output and any additional purchases 
(as determined by Western) to be available for marketing after meeting 
the requirements of Project Use and First Preference customers and any 
other adjustments required for maintenance, reserves, transformation 
losses and [certain] ancillary services.'' While the Base Resource 
contracts do include the term ``regulation'' in this definition, 
Western believes that this service is covered by the 2004 Marketing 
Plan's definition under `` * * * certain ancillary services.'' Western 
proposes to change the method for Restoration Fund collections due to 
the publication of the 2004 Marketing Plan. Western wishes to maintain 
definition consistency and, therefore, intends to use the same 
definition for Base Resource as indicated in the 2004 Marketing Plan 
and the Base Resource Contracts.

B. Inclusion of the PRPO in Western's Power Rate

    Comment: Western should consider including the PRPO as part of the 
CVP revenue requirement and include it in the power rates.
    Response: The Secretary of the Interior, through Reclamation, is 
responsible for assessing and collecting the mitigation and restoration 
payments from CVP Power and Water contractors. Since Reclamation does 
not have a formal business relationship with CVP Power Contractors, 
Western entered into a written agreement with Reclamation that 
establishes procedures to deposit the Restoration Fund Payments 
collected from CVP Power Contractors into the Restoration Fund. With 
regard to Restoration Fund collections, Western acts only as a billing 
agent on behalf of Reclamation. However, Western does not assume any 
financial liability for balances which are not collected from the CVP 
Power Contractors. All legal actions for the collection of Restoration 
Payments owed by Power Contractors will be initiated by Reclamation in 
cooperation with Western. Therefore, Western believes it is 
inappropriate to include the PRPO in the CVP power rate.

C. Allocating the PRPO

    Comment: The 2004 Marketing Plan allocates power to the Power 
Contractors as the Base Resource only after meeting the requirements of 
Project Use and the First Preference Customers and any adjustments for 
maintenance, reserves, transformation losses, and certain ancillary 
services. Depending on reservoir levels, hydrology and water 
conditions, and Reclamation's water deliveries, there could be times 
when the Power Contractors receive little or no power benefit from CVP. 
The commentor stated that during these times, the only beneficiaries of 
CVP power are the water contractors, and they should pay the full 
burden of the Restoration Fund. The commentor suggested that instead of 
using the Power Contractor's Base Resource Percentage as the 
determinant for assessing an individual Power Contractor, Western 
should use the actual energy used by the Power Contractor.
    Response: The PRPO due from the Power Contractors each year is 
assessed by Reclamation. Through the Letter of Agreement, Western has 
agreed to collect the PRPO from the Power Contractors regardless of the 
amount of power received from CVP resources. Therefore, even if Western 
were to base a Power Contractor's PRPO obligation on power deliveries, 
which is similar to the methodology used by Western in the 1998 
procedures, Western would have to reduce the billing determinants and 
increase the Restoration Fund multipliers in order to collect the full 
PRPO. The end result would be the same. As a billing agent for 
Reclamation, this role does not afford Western the authority, nor the 
right, to change the amount assessed to CVP Water customers from the 
Total Restoration Fund Payment Obligation. Given these circumstances 
and in an effort to stabilize the Power Contractors' payments, Western 
proposed a method of calculation based on the Power Contractor's 
individual Base Resource percentages multiplied by the PRPO.
    Comment: Several commentors advocated support of the proposed 
methodology to use a Power Contractor's Base Resource percentage as the 
basis for Restoration Fund payments.
    Response: Western considered the comments provided on the 
allocation methodology and agrees with using the Base Resource 
percentage in the final procedures.

D. Year-end Reconciliation Process

    Comment: Western should provide further clarification on the 
program year and billing months for the year-end reconciliation process 
as it relates to the Exchange Program. One commentor suggested changing 
the computation to include exchanges for all 12 months of the fiscal 
year, rather than exchanges that occur from October through July.
    Response: Western intends the year-end reconciliation process to 
assist in rectifying underpayment made by recipients of exchange energy 
and overpayments by other Power Contractors. Throughout the year, after 
Western prepares the monthly power bills, Western will track the amount 
of exchange energy used and given up by respective Power Contractors. 
In a typical year, this tracking system will begin with power 
deliveries for a 12-month period from the July to June service months. 
In the first year of implementation, the transition year, the tracking 
system will capture exchange energy associated with power deliveries 
during the January 1, 2005, through the June 2005 service period. This 
tracking system will culminate in a year-end reconciliation process 
that will result in a true-up on August's Restoration Fund bills. 
Depending on a Power Contractor's net usage of the Exchange Program, 
there will be either an additional charge or a credit applied to 
August's Restoration Fund bill. Western considered conducting a monthly

[[Page 18623]]

reconciliation as suggested, but due to time and resource limitations, 
Western decided to use the annual true-up instead. Western provided 
further clarification on these annual reconciliation procedures in the 
final procedures.

E. Third-Party Payment

    Comment: Western should ensure that billing and payment procedures 
are flexible enough to accept payments from third-party billing agents, 
such as the recently created CVP Business Corporation.
    Response: Western understands that some Power Contractors may wish 
to use a third-party for payment of their share of the PRPO. Although 
such a business arrangement does not transfer the Power Contractor's 
obligation to make payment, Western understands that the Power 
Contractor might wish to use a third-party agent. As such, Western has 
ensured that the final procedures allow for third-party agents to make 
payments on behalf of the Power Contractors.

F. First Preference Customer Exclusion

    Comment: Several commentors supported Western's proposal to exempt 
First Preference customers from payments to the Restoration Fund in 
recognition of the contributions these counties have made toward 
restoration programs.
    Response: Western proposed excluding all First Preference customers 
as a result of the significant environmental contributions of the 
Trinity River Division and New Melones projects toward CVPIA 
Restoration Fund programs. After evaluating comments provided during 
the comment period and reviewing documents that support these 
environmental benefits, Western plans to maintain the position of 
exclusion for this subset of customers and document this in the final 
procedures.
    Comment: Several commentors opposed the exclusion of the First 
Preference customers from Restoration Fund payments. Comments stated 
that the Trinity Public Utility District (TPUD) has already been 
receiving an increase in the payments of in-lieu-of (ILO) taxes for 
impacts of the CVP on Trinity County. This increase of ILO taxes, 
coupled with the temporary exclusion granted to TPUD for Restoration 
Fund collections, provides more than appropriate compensation for the 
impacts experienced by Trinity County as a result of the construction 
of Trinity Dam. Similarly, other comments questioned Western's intent 
to include Calaveras and Tuolumne counties in the exclusion. The 
comment indicated that these two counties already benefit from 
Western's new marketing plan proposal to deliver firm load factor 
energy to them, even though New Melones may not generate power for 
months.
    Response: Western's rationale for excluding First Preference 
customers from post-2004 Restoration Fund collections is based on the 
contributions the Trinity and New Melones Dam projects and their 
operation have had toward environmental efforts in the areas of 
mitigation and restoration as they apply to CVPIA and other 
legislation.
    Western considered the environmental contributions of the Trinity 
River Division (TRD) and New Melones Project as the basis for excluding 
First Preference customers. Western did not base this decision on the 
financial impacts upon the individual First Preference customers. Some 
customers commented or inferred that this was necessary for Western to 
base its decision. Western examined this financial data as requested by 
the customers; however, these calculations do not provide a full 
representation of the benefits and/or burdens experienced by the First 
Preference customers. There are other intangible benefits provided by 
the TRD and New Melones Project that either directly or indirectly 
provide environmental mitigation in support of CVPIA and/or projects 
supported by the CVPIA Restoration Fund. Since the First Preference 
customers' energy entitlements are limited to a mathematical 
calculation associated with the generation of each respective dam, any 
change to the generation output or reoperation directly affects the 
calculation of the First Preference customers' energy entitlement. This 
concept is a necessary basis for Western's decision to exclude First 
Preference customers from future Restoration Fund collections.
    Comment: One commentor disagreed with Western including the Sierra 
Conservation Center (SCC) in the exclusion, believing that the 
construction of the New Melones Dam had no impact on SCC.
    Response: The authorizing legislation of the TRD and the New 
Melones Project (Pub L. 69-386 (Trinity), Pub. L. 87-874 (New Melones)) 
does not discriminate among First Preference customers within the 
counties of origin. In the interest of consistency and equity, all 
preference customers within the counties will be treated the same. The 
basis for Western's rationale for exclusion is contingent on the 
benefit or contribution that the Trinity and New Melones project 
operations have had on CVPIA environmental mitigation and restoration.
    Comment: Western should consider limiting the period of exclusion 
to no longer than 5 years, as circumstances regarding the rationale for 
exclusion change periodically.
    Response: Western reviewed the procedures and agrees to include a 
provision in the final procedures that provides for a review process 
every 5 years or earlier if certain conditions are met.

Acronyms and Definitions

    As used throughout the remainder of this notice, the following 
acronyms and definitions when used with initial capitalization, whether 
singular or plural, have the following meanings:
    2004 Power Marketing Plan: The final marketing program for power 
marketed by the Sierra Nevada Region after 2004 established through a 
public process and published in the June 25, 1999, Federal Register (64 
FR 34417).
    Administrator: The Administrator of the Western Area Power 
Administration.
    Base Resource: CVP and Washoe Project power output and existing 
power purchase contracts extending beyond 2004 determined by Western to 
be available for marketing, after meeting the requirements of Project 
Use and First Preference Customers, and any adjustments for 
maintenance, reserves, transformation losses, and certain ancillary 
services.
    Billing Month: The month CVP Power Contractors will be billed for 
the Restoration Payments.
    Billing Year: The period, September through August, that represents 
the annual Restoration Fund billing cycle.
    Central Valley Project (CVP): The multipurpose Federal water and 
power project extending from the Cascade Range in northern California 
to the plains along the Kern River south of the city of Bakersfield.
    CVP Improvement Act of 1992 (CVPIA): Title 34 of Pub. L. 102-575, 
106 Stat. 4706 et seq. A legislative act, enacted on October 30, 1992, 
that defines provisions for habitat restoration, improvement and 
acquisition, and other fish and wildlife restoration activities in the 
CVP area of California.
    DOE: United States Department of Energy.
    Exchange Program: A program established in accordance with the 2004 
Power Marketing Plan and intended to allow customers to more 
effectively use their power allocations.
    First Preference Customer: A customer wholly located in Trinity, 
Calaveras, or

[[Page 18624]]

Tuolumne counties, California, as specified under the Trinity River 
Division Act (69 Stat. 719) and the New Melones provisions of the Flood 
Control Act of 1962 (76 Stat. 1173, 1191-1192).
    Fiscal Year (FY): The Federal fiscal year that currently begins 
October 1 and ends September 30.
    Interior: United States Department of the Interior.
    kW: Kilowatt, the electrical unit of capacity that equals 1,000 
watts.
    kWh: Kilowatthour, the electrical unit of energy that equals the 
generation of 1,000 watts over 1 hour.
    Letter of Agreement: Letter of Agreement No. 93-SAO-10156, a 
written agreement between Reclamation and Western that establishes 
procedures to deposit the Restoration Payments collected from CVP Power 
Contractors into the Restoration Fund.
    Midyear Adjustment: The adjustment to the annual PRPO as determined 
by Reclamation on or about April 1 of each year.
    Power: Capacity and energy.
    Power Contractor: An entity purchasing CVP power from Western under 
a contract with a term in excess of 1 year.
    Power Restoration Payment Obligation (PRPO): The portion of the 
Total Restoration Payment Obligation calculated and assigned annually 
to CVP Power Contractors by Reclamation.
    Project Use: The power used to operate CVP or Washoe Project 
facilities in accordance with authorized purposes and pursuant to 
Reclamation law.
    Reclamation: United States Department of the Interior, Bureau of 
Reclamation.
    Restoration Fund: The CVP Restoration Fund, established by section 
3407 of the CVPIA, into which revenues provided by the CVPIA are 
deposited and from which funds are appropriated by the Secretary to 
carry out the habitat restoration, improvement, and acquisition 
provisions of the CVPIA.
    Restoration Fund Bill(s): The instrument prepared and issued 
monthly as a mechanism for collecting the Restoration Payments from CVP 
Power Contractors.
    Restoration Payment(s): The amount(s) recorded as payable on CVP 
Power Contractors' Restoration Fund Bills.
    Secretary: Secretary of DOE.
    Total Restoration Fund Payment Obligation: The total amount of 
payments collected from the CVP Water and Power Contractors calculated 
annually by Reclamation.
    Washoe Project: The Federal water project located in the Lahontan 
Basin in west-central Nevada and east-central California, as described 
in Western's final 2004 Power Marketing Plan for the Sierra Nevada 
Region.
    Western: United States Department of Energy, Western Area Power 
Administration.

Final Procedures

Determination of the PRPO
    Reclamation is responsible for assigning the PRPO for the CVP Power 
Contractors. On or about July 1 of each year, Reclamation will provide 
a letter to Western's Regional Manager of the Sierra Nevada Region with 
the determined PRPO amount and a detailed explanation of the 
computation for the upcoming FY. Upon receiving the letter from 
Reclamation, Western will notify each CVP Power Contractor of the 
annual PRPO and the monthly amounts to be collected from CVP Power 
Contractors.
Allocating the PRPO
    Western will allocate the PRPO among CVP Power Contractors each FY. 
After notification by Reclamation, Western will calculate the annual 
obligation for each CVP Power Contractor. Western will base its 
calculation on the assigned Base Resource percentage for each CVP Power 
Contractor as specified in their power contracts. This annual 
obligation will be divided by the number of months in the FY; i.e., 
twelve, or in the case of FY 2005, the number of months remaining in 
the FY; i.e., nine, to determine the monthly obligation.
    Since the 2004 Power Marketing Plan does not begin until January 1, 
2005, and Restoration Fund collections for FY 2005 (October 1, 2004, 
through September 30, 2005) begin prior to this, FY 2005 will be a 
transition year for Restoration Fund collections from Power 
Contractors.
    Western will base Restoration Fund collections from Power 
Contractors for October through December 2004 upon the existing 
collection methodology articulated in the August 4, 1998, Federal 
Register. Western intends to begin collection under these new proposed 
procedures beginning with January 2005 collections. As a point of 
clarification, Western will bill the Power Contractors for the October 
2004 collection in their September 2004 bills based upon energy and 
capacity amounts for their June 2004 service month. A similar process 
will continue through the December 2004 collection.
    In December 2004, Western will total the Restoration Fund 
collections made by the Power Contractors from October and November 
2004, and the amounts payable for December 2004, and subtract this 
amount from the annual PRPO to calculate the balance to collect for the 
remaining months of the FY. Western will multiply this total by each 
Power Contractor's Base Resource percentage. This amount will then be 
divided by nine, representing the remaining months in the FY (January 
through September) to determine each Power Contractor's monthly 
obligation.
Year-End Reconciliation Process
    Implementation of the Exchange Program may result in some Power 
Contractors receiving small amounts of energy in excess of their Base 
Resource percentage in some months. Although recipients of this 
exchange energy will pay for this power, Restoration Fund obligations 
are based on the Power Contractors' percentage of the Base Resource 
excluding exchange energy. Alternatively, some Power Contractors that 
are not able to use all of their Base Resource and return it as 
exchange energy could be overpaying their Restoration Fund obligations, 
since their actual power usage might be less than their Base Resource 
percentage in a given month.
    In an effort to rectify underpayment made by recipients of exchange 
energy and overpayments by other Power Contractors, Western will 
conduct a reconciliation process, otherwise known as an annual true-up, 
before preparing August Restoration Fund Bills. This reconciliation 
will require Western to identify energy amounts exchanged among 
individual Power Contractors on a monthly basis. Normally, with the 
exception of the first year of implementation, the applicable billing 
periods will track exchange energy associated with power deliveries 
from July to June service months. During the first year of 
implementation, the tracking system will track exchange energy from 
January 1, 2005, through the June 2005 service month. This information 
will provide the basis for determining the amount of energy exchanged 
during the billing year.
    Western will add an additional charge, or a balloon payment, to the 
August Restoration Fund Bills for each Power Contractor who received 
exchange energy during the past year that exceeded their Base Resource 
percentage. Conversely, Western will also post an offsetting credit on 
their August bills for those Power Contractors that provided exchange 
energy, thus decreasing the amount of Base Resource energy received.

[[Page 18625]]

Exclusion of First Preference Customers From the Power Restoration 
Payment Obligation
    Western has discretion how the PRPO is assessed to CVP Power 
Contractors. As a consequence, Western reviewed the contribution the 
Trinity River Division and New Melones projects provide, either 
directly or indirectly, to environmental mitigation in support of CVPIA 
and/or projects supported by the CVPIA Restoration Fund.
    The Trinity River Division's contribution to, and support of, 
environmental mitigation and restoration is many fold. The diversion of 
Trinity River water through the Trinity River Division's plants and 
tunnels benefits CVPIA related projects due to its unique 
characteristics. The lower temperature of Trinity River water makes the 
Sacramento River more conducive to spawning of endangered and 
threatened fish species. In addition, other benefits include the 
dilution effects the Trinity River water affords Spring Creek Dam 
releases/overflows and the substantial volume increase provided to the 
Sacramento River. Further, the final outcome of the Supplemental 
Environmental Impact Statement for the Trinity Record of Decision may 
make it necessary to further reoperate Trinity Dam to comply with river 
flow requirements. It is possible that the First Preference entitlement 
calculation for Trinity County may be reduced, thus effecting the 
energy entitlement authorized by law. The construction of the New 
Melones Dam, though originally intended to provide flood control 
protection, is now also valuable for the benefits it provides for 
environmental mitigation. Like the TRD, its benefit to the CVP in 
assisting to meet CVPIA goals and programs is unique and unlike the 
benefit that any other facility can provide. New Melones' water 
releases to the Stanislaus River, which flow ultimately into the San 
Joaquin River, bear the sole CVP burden of complying and supporting the 
Vernalis Adaptive Management Plan (VAMP) as prescribed in Water Right 
Decision 1641. This program was based on the Bay-Delta hearings, 
supports the State's Water Quality Plan, and is also contained in CVPIA 
legislation. This program requires that water pulse flow targets be met 
and maintained so that 12 years of studies are available and analyzed 
for use by the State Water Quality Review Board. In essence, this 
program has contributed toward a reoperation of New Melones in an 
effort to support VAMP. In addition, New Melones' water releases help 
to support other fish habitat and riparian projects along the 
Stanislaus and San Joaquin rivers as well as water conditions in the 
California Delta, as required by CVPIA.
    The environmental benefits of the TRD and New Melones projects 
toward CVPIA Restoration Fund programs are significant. Since CVPIA was 
enacted, these facilities have been reoperated so CVP meets the 
standards and guidelines set forth by CVPIA. With the reoperation of 
these facilities and the fact that the First Preference customers' 
energy entitlements are based on the generation output of these 
facilities, their reoperation ultimately affects these customers. These 
circumstances provide a basis by which to exclude Restoration Fund 
collections from any First Preference customers within the affected 
areas.
Adjustment to the PRPO
    Each FY's annual PRPO is subject to a Midyear Adjustment determined 
by Reclamation. The Midyear Adjustment occurs on or about April 1 of 
each FY, following Reclamation's annual determination of available CVP 
water supply for the year. Reclamation notifies Western, in writing, of 
the Midyear Adjustment. Upon receiving Reclamation's notification, 
Western will factor the Midyear Adjustment amount into the calculation 
for the remaining PRPO for the year. The bills for the remainder of the 
billing year will reflect the adjusted PRPO. Western will then notify 
each CVP Power Contractor of the Midyear Adjustment to the annual PRPO.
Collection of CVP Power Contractors' Restoration Fund Payment
    Each CVP Power Contractor and any applicable thirdparty agents will 
receive a Restoration Fund Bill each month on or about the twenty-fifth 
(25th ) but no later than the last day of the month. The Restoration 
Fund billing cycle for each FY will begin within 30 days following 
August 1 or the date written notification of the annual PRPO is 
received from Reclamation, whichever occurs later.
Payment Due Date
    All CVP Power Contractors' Restoration Payments are due and payable 
before the close of business twenty calendar days after each 
Restoration Fund Bill is issued, or the next business day thereafter, 
if said day is a Saturday, Sunday, or Federal holiday.
Late Payment Charges Assessed to Delinquent Restoration Payments
    Western will add a late payment charge of five hundredths percent 
(0.05%) of the principal amount unpaid for each day the Restoration 
Fund Bill payment is delinquent. Payments received will be first 
applied to the charges for the late payment assessed on the principal 
and then to the payment of the principal.
Deposit of CVP Power Contractors' Restoration Payments Into the 
Restoration Fund
    On or about the twenty-seventh (27th) calendar day of the month 
following each Billing Month, Western will transfer all of the 
Restoration Payments received, including late payment charges, to 
Reclamation for deposit into the Restoration Fund. The thirtieth (30th) 
of September of each FY is the last day Western will transfer 
Restoration Payments, including late payment charges, to Reclamation 
for that FY.
Review Process
    Western will review the procedures for the assessing and collecting 
of Restoration Payments from the CVP Power Contractors every 5 years or 
if one of the following occurs: (1) If there is a significant change to 
or suspension of the legislation, (2) if a material issue arises, (3) 
if an apparent inequity in the procedures is discovered, or (4) if any 
significant change occurs that affects the procedures.

Availability of Information

    All studies, comments, letters, memorandums, or other documents 
made or kept by Western for developing the final procedures, will be 
made available for inspection and copying at Western's Sierra Nevada 
Region Office, 114 Parkshore Drive, Folsom, CA 95630-4710.

Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.) 
requires Federal agencies to perform a regulatory flexibility analysis 
if a final rule is likely to have a significant economic impact on a 
substantial number of small entities. Western has determined that this 
action relates to rates or services offered by Western and, therefore, 
is not a rule within the purview of the Act.

Environmental Compliance

    In compliance with the National Environmental Policy Act (NEPA) of 
1969 (42 U.S.C. 4321, et seq.), the Council on Environmental Quality 
Regulations for implementing NEPA (40 CFR parts 1500 through 1508), and 
the Integrated DOE NEPA Implementing Procedures (10 CFR part 1021), 
Western has determined this action is

[[Page 18626]]

categorically excluded from the preparation of an environmental 
assessment or an environmental impact statement.

Determination Under Executive Order 12866

    Western has an exemption from centralized regulatory review under 
Executive Order 12866. This notice is not required to be cleared by the 
Office of Management and Budget.

    Dated: March 27, 2003.
Michael S. Hacskaylo,
Administrator.
[FR Doc. 03-9325 Filed 4-15-03; 8:45 am]
BILLING CODE 6450-01-P