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<br />Page 5 of 6 <br /> <br />, <br /> <br />A. further explanation of the legislative purpose was contained in <br />the statement entitled "Need for Section 4(b) of S. 34" furnished <br />by Assistant Secretary Holum subsequent to the hearings and inserted <br />in the p1ilrt1shed, Senate hearing on pages 41-42, "Garrison Diversion <br />Unit, Missouri River Basin. pJ:oject: Rearing on'S. 34before the <br />Subcollllldttee on Irrigation and Reclamation of the Senate Collllldttee 00. <- <br />Interior and Insular Affairs", 89th Cong., 1st Sess. (March 29, 1965), <br />!his statement explains that if the legislative change in the interest <br />rate is not obtained, then "the prospects for accUlll1llation of power <br />revenues for financial assistance to irrigation features are so <br />remote in time as to have the practical effect of precluding their <br />authorization and development noW or in the foreseeable future.'" This <br />in turn, the statement notes, raises the question of what to do with <br />approximately $240 million of costs of the existing storage and power <br />system allocated to future irrigation use., Part of these are so-called <br />"asSigned costs" of storage; the remainder are the costs allocated to <br />irrigation pumping which are the subject of the present inquiry._ <br />!he statement specifically asks the question of what to do with 'these, <br />costs if the lower interest rate is not approved.' One alternative <br />is to write them off "as a national mistake". !he other alternative, <br />equally undesirable, ''would be to reallocate the costs of the main- <br />stem system to reflect the reduced role of irrigation." (This is <br />exactly what would be done by changing from an "ultilllate use" basis <br />of suballocation to a "current use" basis.) The statement c01lllllented <br />that this ''would have the effect of increasing the present commercial <br />power investment suc.'1 that it would be difficult to meet operation <br />and maintenance costs and interest charges." <br /> <br />All of the above references support a rea<ll.1"- discernible congressional <br />purpose through the change in interest rate to reduce interest' costs . , <br />on the investment in Army facilities allocated to commercial power <br />as shown in the Secretary r S report, thereby mak:in.g additional revenues <br />available to assist in repaying future inigation develop1l1ent. Yet <br />'the proposal on which my opinion has been requested would directly <br />defeat this purpose. The change from an ultimate use to a current <br />use basis .,-culd reduce the suballocation to irrigation PUlllping from <br />19 percent to approximately 3 percent, This single change would <br />elimihate virtually the entire saving in interest expense authorized <br />by section 4(b) of the Garrison Act and would negate the congressional <br />policy to treat t,'1e project as a whole for cost allocation and repay- <br />ment purposes. It =y not be effectuated withotlt prior congressional <br />. <br />appro;ral. <br /> <br />, <br /> <br />. <br /> <br />This conclusion is not a new one. In March 1968 the Comptroller <br />General submitted to Congress a report entitled "Need for Olange <br />in Method of Computing the Cost of Power Sold for Commercial Purposes <br />Missouri River Basin Project" in which he specifically recommended <br /> <br />5 <br /> <br />..... <br /> <br />