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<br /> <br />increased from $16./j. million to $69 million. While the $69 million is a preliminary <br />estimate subject to change, the long term repayment contract nonetheless contains <br />no provision for increasing repayment obligations to recognize substantial increases <br />in ability to pay. When the CUWCD contract is amended to cover increased <br />construction costs, the Service should at that time include contract language which <br />insures that water rates paid by irrigators are based upon current periodic <br />determinations of ability to pay. <br /> <br />Our review of the 1977 Power Repayment Study (PRS) disclosed that projected <br /> <br /> <br />power rates are adequate to repay project costs. However, we determined that <br /> <br /> <br />data used for the PRS understated interest costs on future replacements and <br /> <br /> <br />additions, and understated participating project investment costs by about $185 <br /> <br /> <br />million. Understated interest costs were the result of basing such costs on a <br /> <br /> <br />decision by a former Commissioner that CRSP is not subject to normal Depart- <br /> <br /> <br />mental policy. Understated reimbursable investment costs were the result of <br /> <br /> <br />adhering to a policy that does not permit the use of the most current available cost <br /> <br /> <br />data. We are not recommending that the Service revise its PRS because the <br /> <br /> <br />proposed power rates are adequate in the short range. However, we recommend <br /> <br /> <br />that these policies and the Commissioner's decision be reevaluated to insure that <br /> <br /> <br />future power rates are based on current cost data and that interest rates are in <br /> <br /> <br />keeping with the objectives of Departmental policy. <br /> <br />Public Law (P.L.) 8/j.-/j.85 (the Act) which authorized CRSP provides that storage <br /> <br /> <br />project revenue will be used to repay storage project investment costs. After <br /> <br /> <br />these costs have been repaid, such revenues will be apportioned to Colorado, New <br /> <br />3 <br />