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<br />APPEND LA 3 <br />Page 4 of 5 <br /> <br />2 <br /> <br />after irrigation assistance to total $649,624,000 rather than the <br />$504, 795 ,000, presented in Appendix 2. <br /> <br />(b) It is not clear how the $182 million increase in interest <br />revenues was derived. <br /> <br />(c) It is not clear how the present value of the net increase in <br />accumulated apportioned revenues is derived. The accumulation of <br />revenue due to apportionment is estimated to begin in year 2009 <br />through year 2090 and occurs as irregular annual flows, As a <br />result, the net increases for each year would have to be <br />discounted and the resultants summed for a total present value of <br />the increase in apportioned revenues, <br /> <br />(d) With the inclusion of the Bonnevill~ Unit in the power <br />repayment study, it is not apparent how extending the repayment <br />for a single year could increase interest revenue by $28 million. <br /> <br />3, Page 2, Paragraph 2: <br /> <br />Report: "The municipal and industrial water users fully return their <br />allocated costs plus interest and will assist in repaying a minor <br />portion, about $70 million, of this irrigation debt." <br /> <br />Discussion: The above statement is somewhat misleading. The $70 <br />ml1110n assistance from municipal and industrial (MIll sales appl ies <br />only to costs allocated to irrigation and other consumptive uses of the <br />mainstem storage units, not participating projects, In order to assure <br />the deliveries to the Lower Colorado River Basin required by the <br />Colorado River Compact of 1922, it was determined that approximately <br />1,800,000 acre-feet of storage would have to be provided on the mainstem <br />of the Upper Colorado River, Since this holdover storage was planned to <br />allow the Upper Basin states to develop water for irrigation and other <br />consumptive uses, the costs of storage in the mainstem system were <br />allocated to this purpose, Revenues from the sale of M&l water from the <br />mainstem storage are applied to this cost allocation and make up the $70 <br />million of MIl assistance to irrigation, Revenue from M&I use on <br />participating projects covers the assignment of MIl costs, therefore <br />there are no surplus revenues to be applied to irrigation assistance, <br /> <br />4, Page 3, Paragraph 1: <br /> <br />Report: "Not all projects are inc:.1uded in the study, <br /> <br />Discussion: This statement is incorrect, The irrigation assistance <br />requlrements for those projects:~ferred under the August 1983 Agreement <br />are sent to Western Area Power Administration (Western) and are included <br />in the study. However, the repayment schedules of these projects are <br />shifted beyond the rate-setting years as agreed. <br /> <br />" <br /> <br />14 <br /> <br />i <br />f <br />