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LETTERS OF SUB]i.HT'1'At 'XI this case w'ill be studied with a view to formulating a procedure for determining the appropriate allocation of costs, if any, that should be made to flood control for projects in which no definite reservation of storage for flood control is contemplated. . I am pleased to inform you that the proposed plan of improvement for the Paonia project does not interfere with any authorized or proposed imptovements by the War Department. Sincerely yours, . ROBERT P. P:ATTERSON, Secretary oj War. Mr. MICHAEL W. ~hRAUS, Oommissioner, Bureau oj Reclamation, Department oj the Interior, Washington 25, D. O. DEAR MR. STRAUS: The comments herein with respect to project planning report No. 4-8a.4-1 Qn the plan for development of the Paonia project, Colorado River Hasin, Colo., by the Bureau of Reclamation, dated February 1946, are transmitted in response to your letter of June 3, 1946, requesting the Commission's comments on the proposed plan of development. This is in accordance with the established procedures of the Federal Interagency River Basin Committee. The report presents a plan for the development of the Paonia project, to consist of the construction of the Spring. Creek Dam on Muddy Oreek/ a tributary to the North Fork of the Gunnison River to form a 14,000 acre-foot reservoir which would control and supply water for the supplemental irrigation of lands under the Fire Moun- tain Canal; the enlargement and extension of the Fire Mountain Canal, which diverts water from the North Fork of Gunnison River; and the reconstruction and enlargement of the Overland canal, which diverts 'water from Leroux Creek. The development would provide a supplemental water supply for 12,750 acres ofland now inade- guately irrigated and a water supply for 2,000 apres of new land. . The report states that local flood. protection also would be provided. The plan does not provide for the initial or future generation of hydroelectric power. The report shows the estimated capital cost of the proposed work, based on 1940 costs to be $1,551,000, and states thaton that basis the ratio of benefits to costs is 2.6 to 1. The report recommends that the project be authorized to be constructed, operated and main- tained by the Bureau of Reclamation. The Commission staff has reviewed the report and concludes that there would be no justificaticm for any alterations of the plan to provide for initial or future generation of hydroelectric power, and that the proposed plan would not impair any potential water power values in the basin. Sincerely yours, FEDERAL POWER COMMISSION, Washington 25, August 14.,194.6. LELAND' OLDS, Ohairman, 1 Properly designated East Muddy Creek.