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" , e /VtJ< ;::;'1 t2.- , ," " United States Department of the Interior BUREAU OF RECLAMA nON UPPER COLORADO REGIONAL OFFICE P.O. BOX 11568 SALT LAKE CITY, UTAH 84147 FEB 6 1987 IN REPLY REFER TO: UC-722 Mr. John W. Hawkins Project Manager Overland Dam Rehabilitation Project Overland Ditch and Reservoir COmpany 1342 County Road 2600 Hotchkiss, Colorado 814-19- Dear Mr. Hawkins: We have given the requests in your letter of January 2, 1987, careful consideration. We understand your requests to be as follows: l. Can the Overland Company change the Overland Dam design to raise the height of the dam and increase reservoir storage capacity? 2. Can the Overland Company extend the contract repayment period from 40 years to 50 years? In answer to the first question, we feel that it is in the best interest of both the Overland Company and the U.S. Government to not enlarge the dam and reservoir at this time. From a technical standpoint, we would like the rehabilitation completed as planned and the dam and foundation monitored for several seasons before an enlargement be made. From a financial standpoint, we prefer to have your annual repayment amounts as close as possible to your previously calculated payment capacity, thus reducing the financial burden to the Overland Company. In answer to your second question, the Small Reclamation Projects Act, prior to the 1986 amendment, does state that repayment will be in not more than 50 years. However, it has been the policy of the Bureau of Reclamation and now is a matter of law under the 1986 amendment to restrict loan repayment periods to 40 years maximum, the term on which your loan approval was based. In order to extend the term from 40 to 50 years, your contract would have to be formally amended to extend the repayment period and to include any additional policies which are in effect at that time. Most importantly, however, the amended contract would require congressional approval of the extension'since it would be less advantageous financially to the United States. Upon completion of the rehabilitation, per your approved plans and specifications, excess Federal funds would then be returned to the Federal Treasury. A supplemental loan application would be necessary for a future Federal loan for an enlargement. ( , v, .. ,_, , ..