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Power Revenues For Water Project Fint;lncing 'I o~ /f 1/ by Gowno, Richo,d D. IAmm (:1JA6. /d~.,.f,>~ I yr' I ~u('..t; /,/0.--3 nor Matheson of Utah. My purpose was tosee iflhe ground- work could be laid for subsequent negotiations that would result in support for federal legislation that would make CRSP power re\'cnu('s payable annually for the di~cl benefit of the Upper Basin stales to use in financing Ihe .., construction of water projects. j...... 1'"' ~ ", ::0 I I I I . Colorado's efforts to make fuller use of its share of Colo~ rado River water have ~en frustrated by recent turns in I federal policy. We ha\'c substantial hopes that the Senale I will approve initial appropriatiom for the Animas-La Plata Project. but we know thai prospects for major federal fund- ing for other water development projects are remote. I have a proposal for bn~aking the impasse that has held back our west ~Iope water development. It requires tapping the revenues produced by electrical power generated by Colo- rado River water in the Upper Basin. The Upper Colorado River Basin Fund was inlended to I facilitale the development of Colorado's compact emitle- ment to Colorado River water. We have indirectly benefited from the power revenues generated by the Colorado River Storage Project (CRSP) storage units. The revenues are to I be med to repay the costs of building the existing dams in the . Upper Basin. But commitments were made by the federal government and the other ba~in states to furnish additional storage facilities and those commitments cannot and will not I be honored under the present structure of the Upper Basin I Fund. . I In recognition of our plight. Colorado has insisted to the other basin states over the past two years that we will not condone the use of CRSP power revenues to frOnl-end finance new programs. such as weather modification and L salinity control projects. Our position has been Ihat power Irevenues should not be used for other purpose!> when we have nOI yel realized our equitable share of Colorado River I Basin development opportunities as contemplated in the 1956 Colorado River Storage Project Act and the 1968 I Colorado River Basin Project Act. It appears that our remaining authorized, participating projC'Cls-San Miguel, West Divide. Fruitland Mesa, and Savery.Pothook- cannot be obtained through the traditional Congressional appropriations process. Thus, changes in the use and dispo~ sition of CRSP power revenues are needed if Colorado is to be made whole. - --- Ilookforword to working with the Board in the months ahead. Our "window of opportunity" is narrow. We must move q/Jick~I' and deliberately. I invite Colorado water interes/!i to make their com- ments knOl\'n /0 the Board. \~'hich will ha\'e the lead responsibilityfor the negotiations andfe,leral. legis/mh'e efforts that are to be undertaken. We ha....e discus~ed several concept~ for making power revenues available to the Uppcr Di\'ision statcs, One would im'olve changing the procedures by which power rales are determined. thus making it possible to divert a portion o(lhe revenues now generated to the Upper Basin states wilhout actually altering the rate charged for CRSl) power. Two olher concepts would involve an oUlright increa~e in. or surcharge on. theexi~ting power rate (which i~ about 10 mill~ per kilowatt-hour, composite rate). One surcharge would bc levied only on Colorado customers of CRSP power (a "dif~ (erential" surcharge), while the other surchar8e would be uniformly applied 10. all CRSP power cuslomen in all ~talcs (which include the lower Basin). We are sU8gesting that the revenue~ from an)' differential surchar8es go to the state whose power customers are so charged. Revenues from the uniform surcharge and the portion diverted (rom revenues under the existing rate would be divided among lhe Upper Ba~in slales pursuant to the percentage allocation for the Upper Ra~in Fund embo- died in the 1956 Act (i.e.. 46 percent to Colorado). Ideally. any CRSP power revenues directed to thc Upper Basin Slates will be available for investment in water project development a!l each stale sees fit. This would free us from the inevitable string~ that are attached to federal dollars. We would decide what projects 10 build and when."Colorodam would Jet eri/triojor Colorado projecu." Many details still need to be sorted out and admittedly difficult questions addressed. The Colorado Water Conscr~ vation Board is Ihe proper agency to discuss and debate these issues, receive the public's input. and delail Colorado'!> position. J brought this mailer to the Board's auention at its November 3-4 meeting and asked that it consider how 10 proceed. The Board unanimously approved of the effort to obtain CRSP power revenues for the dir<<t benefit of the state and asked its director. Bill McDonald, to enter into negotiations "''1th the other six states and power customers a,ong the lines discussed above. The Board also directed that Mr. McDonald bring together interested Colorado water users and power customers so as to receive their input as negotiations progres~. I look forward to working with the Board in the months ahead. Our ''window of opponunity" is narrow. We must move quickly and deliberately.l invite Colorado waterinter~ ...!.!,lS to make their comments_kno.wM.o..thc Board, whish~ill_