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. <br />Testimony of Donald D. Kraus <br />February 16, 2002 <br />BEFORE THE <br />UNITED STATES HOUSE OF REPRESENTATIVES <br />COMMITTEE ON RESOURCES <br />Testimony of Donald D. Kraus, General Manager <br />The Central Nebraska Public Power and Irrigation District <br />Good afternoon. My name is Don Kraus. I am the General Manager of The Central <br />Nebraska Public Power and Irrigation District (Central). Central is a not - for - profit <br />political subdivision, governed by a board of elected representatives, established under <br />the laws of Nebraska to provide surface water irrigation and hydropower. Our Kingsley <br />Dam Project stores water in Lake McConaughy in western Nebraska for an irrigation <br />distribution system 150 miles downstream in the central Platte River area. We provide <br />surface water for approximately 220,000 acres of farmland, and indirectly serve over <br />300,000 additional. acres irrigated from wells by maintaining a reliable elevated <br />groundwater table. Theproject also produces hydropower, which we sell in the <br />wholesale market. <br />I am primarily testifying today about the Cooperative Agreement, but I also have some <br />comments on the proposed critical habitat designation for piping plover. <br />Central's hydroelectric plants are licensed by the Federal Energy Regulatory <br />Commission. In the mid -1980s Central and the Nebraska Public Power District (NPPD) <br />(collectively the Districts) began proceedings to renew our long -term licenses for the <br />Kingsley Dam project and a smaller, interrelated project operated by NPPD. This <br />provided the "federal nexus" needed to invoke the consultation requirements of the <br />Endangered Species Act. The Fish and Wildlife Service (Service) proposed that <br />substantial environmental conditions be placed in our licenses. The water release <br />conditions implicated the water rights of thousands of Nebraska farmers, and would have <br />substantially reduced their protection against drought. By our estimate, the Service's <br />final proposed conditions would have cost over $150 million. Central expected to bear <br />about 80% of that burden. Our total annual budget is about $10 million. <br />To put this in perspective, the Districts' projects are two among hundreds on the North or <br />South Platte Rivers. The Service did not apportion mitigation among those projects, but <br />instead tried to get as much as possible from each project as it needed a federal permit. <br />This approach was not efficient or equitable. After ten years, the Districts had spent over <br />$35 million on legal fees and technical studies with no reasonable end in sight. <br />Water projects needed federal approvals in each basin state, including federal dams on <br />the North Platte River that serve Wyoming and western Nebraska and municipal water <br />